20 March 2013 11:32 [Source: ICIS news]
LONDON (ICIS)--An initial European March monoethylene glycol (MEG) contract price was followed at €1,070/tonne ($1,372/tonne), the buyer involved said on Wednesday.
"I think the number is too high personally but the difference is not so huge. So we decided not to wait to follow, just to make it clear," the buyer said, referring to the lengthy discussions and unsatisfactory outcomes of recent contract agreements.
Usual factors such as Asian parity should have brought the March price down to €1,030/tonne FD (free delivered) NWE (northwest Europe), but higher upstream costs were also taken into consideration, he added.
The buyer said; "… Europe [MEG] should be around €1,030/tonne plus minus".
A second customer said; "… higher ethylene costs made it a hard fought victory [for sellers]. An element of the silly February settlement is in there."
Buyers were seeking to lower the March contract price in order to compensate for what they saw as an inflated February price increase of €37/tonne from January. February's €1,105/tonne included a compromise in favour of the sellers.
The March €1,070/tonne represents a drop of €35/tonne from the February contract that was concluded alongside the initial March figure on 13 March.
The initial February price was agreed as a dual settlement with the confirmed January price on 24 January.
The seller involved in the second March settlement was not available for comment.
($1 = €0.78)
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