Europe acetone spot prices steady, demand from solvents quiet

15 March 2013 15:11  [Source: ICIS news]

LONDON (ICIS)--European acetone spot prices are steady, but demand from the solvents sector is quiet and a little concerning, sources said on Friday.

“I see [spot] prices in the low €1,100s/tonne [$1,429/tonne] on a free delivered [FD] basis, I’ve not seen any free delivered prices below this but demand is really quiet and I’m a little worried,” said a trader of acetone normally active in the ARA (Amsterdam, Rotterdam, Antwerp) region.

“OK so we’re mid-month but things are not really moving and I’m not sure what direction the market will go in during the second half of the month,” the trader added.

Acetone prices have been slowly moving down since the middle of February after hitting a high of   €1,200/tonne FD NWE (northwest Europe).

Values have been fairly steady over the past three weeks, but most price ideas are now closer to €1,100/tonne, rather than €1,200/tonne.

In relation to its acetone business this week, a second trader said: “I would say the market is very stable and there are no price decreases at all. Enquiries are there, we’re mid-month and there is no need to lower prices.”

Although the trader said prices were unchanged it confirmed the demand felt “a bit on the low side” and believed this was because acetone prices were too high.

Various shutdowns are planned in the coming months and because of this the trader expects to see current spot acetone values remaining unchanged for “at least the next eight weeks”.

Italy-based producer Versalis is due to have a three-week outage at its 185,000 tonne/year acetone plant in Mantova, starting the second half of April.

According to market sources, INEOS Phenol is currently building stocks ahead of a planned outage at its 415,000 tonne/year plant in Antwerp, Belgium, from mid-May to mid-June.

Confirmation from either producer in relation to more specific dates of the outages were not available.

Another re-seller of spot acetone also confirmed market dynamics were unchanged in terms of availability remaining tight, but added that demand was not strong because prices were too high.

“Prices have not really moved, maybe going down slightly to €1,100-1,140tonne. This is where most business is done. There is business but demand is down because prices are high,” the re-seller said.

“Those that don’t need to buy won’t. From my point of view the landscape has not changed,” it added.

Acetone is a by-product of phenol and for every tonne of phenol made, 0.62 tonne of acetone is produced.

Production for primary product phenol has been reduced not only in Europe, but globally, because of poor demand for key phenol derivatives, such as polycarbonate (PC) and resins.

Sources in the European phenol market do not expect to see phenol operating rates increasing anytime soon because downstream demand across the phenol chain remains low.

($1= €0.77)

By: Julia Meehan
+44 20 8652 3214

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