US ACN market waiting on March propylene contracts to settle

06 March 2013 22:49  [Source: ICIS news]

US ACN market waiting on March propylene contracts to settleHOUSTON (ICIS)--The US acrylonitrile (ACN) spot market is waiting to see what happens with propylene prices later this week before making any major moves, market sources said on Wednesday.

“Buyers are a little scared,” one market participant said. “So we have a little ‘wait and see’ going on.”

But several market sources said that even if prices for propylene – a key feedstock – go down, it may not have much of an impact on US prices, as a result of tight supplies.

“It may not be enough to drive prices down to the $1,900/tonne [€1,463/tonne] range,” which is where a lot of the market would like to see ACN prices, one source said.

The US March polymer-grade proplylene (PGP) contract is expected to settle down by about 5-6 cents/lb ($110-132/tonne). Typically, PGP contracts settle about 2-3 cents/lb above spot prices, which ended February at 70 cents/lb.

There were three spot ACN trades for the week ended 1 March, sources said.

Two parcels for $2,000-2,050/tonne went from Brazil to Europe, a deal that was not confirmed on the buyer side. A third parcel, from the US Gulf to Brazil, was heard sold for about $2,000/tonne, market sources said.

Another producer was said to be negotiating a US spot trade for $1,980/tonne US Gulf.

“There has been some modest spot trading,” said one source. “But I don’t really see a price point breaking until late March.”

Until then, the source said, they see “a pretty hard floor at $1,950/tonne”.

The ACN spot price as of 1 March was $1,900-2,050/tonne, as assessed by ICIS.

US ACN producers include Ineos, Cornerstone, Mitsubishi, Ascend and Pemex.

US ACN buyers include Omnova Solutions and Kaltex Fibers.

($1 = €0.77)

By: Staff Reporter
+44 20 8652 3214

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