06 March 2013 11:12 [Source: ICIS news]
LONDON (ICIS)--European mixed xylenes (MX) activity has slowed down for March, sources said on Wednesday, with the outlook for the market unclear amid volatile oil and energy numbers as well as lower derivative offtake.
“There is a big question mark hanging over March,” one trader said. “We don’t see any arbitrage into other regions, and there is no PX [paraxylene] demand.”
The spot market has been quiet so far in March, with offers of $1,325/tonne (€1,020/tonne) FOB (free on board) Rotterdam heard but no firm corresponding bids.
A softening Asian market has also dampened sentiment in Europe. Prices in the region slumped earlier this week as Brent oil futures fell below $110/bbl, while poor Chinese economic data also eroded confidence in downstream offtake.
Despite the subsequent rebound, market players are cautious over the future of the downstream textile sector as a poor sales-to-output ratio and weak demand continue to plague polyester makers amid macroeconomic uncertainty.
In Europe, there had been some aggressive selling in the German distribution market towards the end of February, with some low numbers touted by suppliers.
However, other sellers are keen to maintain higher numbers, although one buyer felt this was too optimistic as it is largely based on exchange rate fluctuations rather than demand patterns.
($1 = €0.77)
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