05 April 2013 17:04 [Source: ICIS news]
LONDON (ICIS)--April and second-quarter contract price negotiations in the European methyl methacrylate (MMA) market are slow as a result of holidays and recent industry events, as well as wide pricing ideas, sources said on Friday.
Many market participants were on holiday this week and last week, and a number of players were in attendance at the European Coatings Congress and Show from 18-21 March, and also at the International Petrochemical Conference (IPC), hosted by American Fuel & Petrochemical Manufacturers (AFPM), from 24-26 March.
MMA producers are targeting hikes of €120-145/tonne ($156-188/tonne) on tightening supply, improving demand, high raw material costs, and to restore margins.
There is a general acceptance among most buyers that prices will increase over first-quarter levels, although some buyers are doing their best to secure a small decrease or a rollover in second-quarter contracts.
Offtake from the coatings and polymethyl methacrylate (PMMA) industries has not picked up as it usually does in spring, because of cold weather across Europe and amid weak macroeconomic conditions.
Consumption levels are lower than those seen in the same period of 2012. MMA demand is usually at its strongest in the second quarter, but participants across the supply chain talk of the lack of confidence in the sector, exacerbated by the cold weather and ongoing concerns about the troubled eurozone economy.
One buyer said: “We will have to go for a small increase, it's realistic. But I’m not willing to pay €140/tonne up.” The buyer added: “Demand is steady, but low. Availability is no problem.”
The April feedstock acetone MMA contract price has fallen from the previous month on the back of lower propylene feedstock costs, which fell by €50/tonne this month. Meanwhile, the European methanol contract price for the second quarter was agreed up by €20/tonne.
MMA sellers said there had been some positive feedback from initial discussions to support their targets, but said there had been little progress made this week.
The sector last saw a quarterly contract price rise in the second quarter of 2012.
Negotiations are likely to continue for at least another couple of weeks.
($1 = €0.77)
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