01 March 2013 09:09 [Source: ICB]
Several players announce price increases, which they say are linked to recent price hikes of raw materials
Asia's polymethyl methacrylate (PMMA) producers are eyeing price increments to improve margins, but the extent of the increments might be limited because of weak demand, said industry players on 22 February.
Japan's Kuraray announced on 20 February a price increase of yen (Y) 20/kg for its domestic customers and a 10% increment for its export customers for all PMMA grades effective from 5 March, in order to improve profitability on the back of rising raw material costs.
Japan's Mitsubishi Rayon Co (MRC) also announced on 19 February a Y20/kg and a $250/tonne increment for its domestic customers and export customers respectively for all PMMA grades effective from 1 March, to recoup margin losses on the back of high raw material costs, according to a statement ICIS received.
Germany's Evonik Industries also announced a price increase on its website on 1 February for its range of PMMA with immediate effect.
The price increase will be $200/tonne for all grades. The hike is unavoidable because of some recent price hikes of raw materials, which cannot be compensated by Evonik, the statement said.
Evonik markets its PMMA compounds in Asia under the brand name PLEXIGLAS.
A South Korean PMMA producer said he is considering hiking its prices by $50-100/tonne for March cargoes to improve margins.
"I hope to achieve at least $30/tonne increments for bigger sized customers and perhaps even up to $80/tonne for smaller sized customers," the producer said.
"It is too early to decide [on the price increments], everyone is in a wait-and-see mood," a separate major Asian producer said.
In the week ended 21 February, general purpose (GP) PMMA prices on a CFR (cost & freight) SE (southeast) Asia basis were at $2,550-2,600/tonne (√õ1,913-1,950/tonne) and at $2,200-2,300/tonne on a CFR China basis, largely unchanged from the last four months.
HIGHER IMPORT PRICES
Many market participants said they expect PMMA import prices for March shipments, especially those of China, to be higher, but the extent of the increments might be limited because of weak demand.
"The market is very weak for many months now. I am not sure whether the price increments can be possible," one trader said.
While demand is traditionally expected to improve in March as end-users usually replenish stocks ahead of the higher production season in the second quarter compared with the first quarter, some market players expect that the slow recovery in the US and eurozone economies will continue to exert downward pressure on Asian finished PMMA goods exports.
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