16 April 2013 20:57 [Source: ICIS news]
HOUSTON (ICIS)--US April epoxy resin contract prices widened because of a split settlement, sources said on Tuesday.
Several buyers and producers confirmed that some US April epoxy resins contracts rolled over, while others increased by 4-8 cents/lb ($88-176/tonne, €68-136/tonne).
“Have we seen a volume impact on going up? That would be fair to say,” a producer said. “But everyone knew more imports were coming in.”
The split settlement puts ICIS assessments for domestic epoxy resins at $1.52-1.62/lb DEL bulk (delivered in bulk) for material shipped in April.
The producer said that going up by 4-8 cents/lb has widened the arbitrage window for imported epoxy resins.
Sources said import pricing is $1.38-1.45/lb DEL bulk, and that demand is strong for April orders that will arrive in May and early June.
“The problem is the gap between the two is too wide,” a buyer said. “There is a lot of frustration with the domestic producers.”
The buyer added that the main reason that producers attempted to push contract prices higher – low margins – is affecting the entire chain as well.
Producers said that steady pricing at the end of 2012 eroded margins because feedstock costs for benzene and propylene derivatives soared.
Most market players are expecting a drop in May contract settlements, although no nominations have been heard.
“The threat of imports will push prices lower,” the buyer said. “The market is oversupplied as it is.”
Major US epoxy resins producers include Dow Chemical, Huntsman and Momentive.
($1 = €0.77)
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