US Q2 fatty alcohol contract discussions under way

14 March 2013 17:33  [Source: ICIS news]

HOUSTON (ICIS)--Second-quarter contract discussions are under way in the US fatty alcohol market, buyers and sellers said on Thursday.

Several sellers confirmed that contract negotiations are beginning, while large buyers confirmed that second-quarter contract volume requirements are being placed.

At least one large mid-cut buyer said it is nearing settlement, with price direction trending slightly down.

One seller said it continues to aim for a rollover from the first quarter, while another seller said alcohol prices could edge down.

“We do think alcohol prices may have bottomed, but overall price direction is still unclear on the contracts,” a seller said.

Mid-cut detergent range C12-15 fatty alcohol domestic contract prices were assessed at 87-100 cents/lb ($1,918-2,205/tonne, €1,477-1,698/tonne) for the first quarter.

Alcohol buyers and sellers said the US market is moving towards balance, but buyers characterise it as still being loose on the supply side for second-quarter business.

US natural fatty alcohol supply was considered to be full for several quarters, as routine shipments from Asian producers are ill-matched to the widely moderating demand in key end-uses such as household detergents and personal care.

US demand is said to be improving, but buyers have continued to maintain narrow inventories as the domestic economy is only just beginning to offer consumer confidence.

The US is a net importer of fatty alcohols, as most natural alcohol production is from palm kernel oil feedstock and most producers are located in Asia.

However, Shell and Sasol produce detergent-range alcohols by synthetic processes in the US, respectively utilising ethylene and gas-to-liquids chemical routes.

 

 

 

 


By: Judith Taylor
+1 713 525 2653



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