24 March 2013 20:34 [Source: ICIS news]
SAN ANTONIO, Texas (ICIS)--It is only a matter of days before US’ monoethylene glycol (MEG) prices fall to the low levels seen in Asia recently, a buyer said on Sunday.
“Asia is the centre of the universe for MEG pricing. Unless there is a major unknown event such as a hurricane, we can almost always count on US prices lagging just behind Asia movements,” the buyer on the sidelines of the International Petrochemical Conference (IPC).
Asia’s MEG prices dropped last week on the back of lower crude futures and long supply-demand fundamentals.
Spot prices were seen at around 46 cents/lb CFR (cost and freight) China Main Port, while the April contract price in Asia dropped by as much as $150 (€116/tonne) to $1,150-1,210/tonne (52-54 cents/lb) DEL (delivered).
The price fall in Asia stem from long inventories and reduced offtake from the polyester segment. Polyester production accounts for more than 80% of the total demand for MEG.
Price declines in Asia have caused the US prices to soften, with spot values in the low-50 cents/lb levels in the week ended 22 March.
“I suspect we’ll see spot values in the US in the mid-40s cents/lb, and possibly lower in April and May, then the price will go back up around June,” the buyer said.
Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC continues through Tuesday.
($1 = €0.77)
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