22 March 2013 08:33 [Source: ICIS news]
SINGAPORE (ICIS)--The expected increase in seasonal demand for polymeric methyl di-p-phenylene isocyanate (PMDI) in the Middle East has yet to materialise this year because of softening feedstock benzene prices, market sources said on Friday.
A seasonal improvement in demand from the downstream construction sector is usually observed in March-April, with the onset of warmer weather, the sources added.
However, this year buyers have adopted a cautious stance in their purchases because of the softening feedstock benzene prices.
Spot benzene prices were assessed at $1,270-1,285/tonne (€978-989/tonne) FOB (free on board) Korea at the close of business on 21 March, according to ICIS data.
Looking to the second quarter, sellers are firm on implementing either a rollover or an increase in their offer prices, because of the need to recoup eroded margins from previous benzene price hikes.
Buyers, however, said that any price increase for PMDI will not be justified in view of the weak downstream demand and easing benzene cost pressure.
PMDI is used in the production of rigid and semi-rigid polyurethane foams, which account for some 80% of global consumption. The majority of the material is used in the construction industry.
($1 = €0.77)
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