01 May 2013 14:54 [Source: ICIS news]
LONDON (ICIS)--Ethanolamines producers have no intention of reducing their May ethanolamine prices, sources said on Wednesday, as the European ethanolamines market digested the recent May ethylene contract price settlement.
“In general, my feeling from my supplier is that it is holding as firm as it can on price,” a reseller said.
The reseller added that it felt the market was on the tight side, and quoted the mid €1,400s/tonne ($1,842/tonne) FD (free delivered) NWE (northwest Europe) for monoethanolamine (MEA), and the mid €1,100s/tonne FD NWE for diethanolamine (DEA).
Most sources said it was still too early to talk about May ethanolamines prices, because the ethylene contract had only recently settled and there was a holiday across much of Europe. However, several sources said that producers looked to be holding firm on price reductions.
In relation to the recent ethylene settlement and what it might mean for ethanolamines in May, a buyer said: “I’m curious, because it’s one of those downstream products that producers can maintain a high price for even if feedstock prices fall.”
“If demand is good compared with availability, who knows?" the buyer added. "I don't know yet since it's the first of May and my new prices will come in during the next few days.”
On the selling side, a producer said it had no intention of reducing its price despite ethylene coming off by €100/tonne.
“From our perspective I have picked up a little bit of downward pressure in Germany, Italy and in the Med," the producer said. "They [customers] are saying ethylene has dropped, and what are we going to do. But margins on these products are so low, and we are trying to hold the line.”
“Ethylene has given us some relief so we will stay with our prices as is. If they [our customers] want to give up three trucks and just take one – take the one and we keep our price,” the producer added.
The producer described demand as “nothing exciting” but said it was surprised at the amount of spot enquiries it had received in April, adding that it had “more orders than expected”.
Another source buying and selling ethanolamines said it was too soon to talk about May pricing, but said it was not expecting a significant change in terms of pricing or supply and demand.
“It’s too soon to say and I don’t see anything happening in the market yet, but I don’t expect too much to happen," the trader source said. "I have a feeling availability is a little limited – maybe this is driven by the BASF outage.”
BASF has planned a three-week outage at its 500,000 tonne/year feedstock ethylene oxide (EO) plant in Antwerp, Belgium for the first three weeks of May, in order to carry out maintenance. This will mean halting its ethanolamine operations, but BASF was unable to give exact dates.
Ethanolamine prices in April were steady-to-soft, while the April ethylene contract price moved down by €60/tonne.
Ethanolamines can be used for applications such as agrochemical production, surfactants, personal care and construction. MEA is produced by reacting EO with ammonia. The chemical reaction also produces DEA and triethanolamine (TEA).
($1 = €0.76)
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