19 March 2013 13:05 [Source: ICIS news]
NUREMBERG (ICIS)--European epoxy resins prices are likely to increase in April as producers need to improve margins, epoxy resins traders told ICIS on the sidelines of the European Coatings Congress and Show on Tuesday.
"If prices stay at current levels, I will be losing €100/tonne," an epoxy resins distributor said.
As a response to eroding margins and high feedstock costs, European producers have been targeting increases since January 2013, with mixed results. Their latest targets range from €100-250/tonne ($130-325/tonne), effective from 1 April.
"Unfortunately, because there is a lot of cheap [South] Korean material on the market, it will be difficult to implement those targeted increases," the distributor added.
South Korean LER is offered at around €2,300-2,350/tonne delivered, duty paid (DDP) Europe, with one trader also hearing of offers at €2,250/tonne DDP Europe.
"With these prices we cannot compete, and unless the market becomes seriously tight, huge increases are impossible," the distributor added.
"I think there is going to be an increase in April, but the question is how much can be passed on," a trader said.
The epoxy resins market has been especially badly hit by the economic downturn since 2009, on the back of high feedstock costs and low demand from the downstream coatings, automotive and construction industries.
The price of benzene, a feedstock of epoxy resins production, went from €754/tonne free on board (FOB) northwest Europe (NWE) in July 2011 to 1,054/tonne FOB NWE in March 2013.
During the same period, the price of liquid epoxy resins (LER) changed from €2,900-2,950/tonne free delivered (FD) northwest Europe (NWE) to €2,630-2,670/tonne FD NWE.
The congress runs from 18-19 March while the show will be on from 19-21 March. ($1 = €0.77) Follow Janos on Twitter.
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