Europe May ethanolamines prices falling €30-40/tonne – sources

08 May 2013 16:32  [Source: ICIS news]

LONDON (ICIS)--Ethanolamines prices in May are moving down by €30-40/tonne ($39-53/tonne) following the steeper than expected drop in major feedstock ethylene amid a balanced market, the majority of sources said on Wednesday.

“First of all we have to admit we were surprised about the huge decrease on ethylene. For sure I am not ready to pass all this to the market - my intentions is €30-40/tonne,” said one European producer.

“What we see is customers are still not buying like hell - that is clear. Everybody is keen to negotiate and take every advantage of every enquiry,” the producer added.

The producer also said it had received more enquires for monoethanolamine (MEA) than in recent months, suggesting that this might be caused by a planned shutdown by BASF. 

BASF planned an outage at its 500,000 tonne/year feedstock ethylene oxide (EO) plant in Antwerp, Belgium, during the first three weeks of May, in order to carry out maintenance. This will mean the company halting its ethanolamine operations around the same time.

A buyer, who had yet to start its May price negotiations said: “No prices yet – but I am expecting a decrease of €45/tonne on the back of ethylene. Producers realise they need to do something and they manage to keep the market stable”.

In the trade and distribution markets, sources were also talking about price decreases in May, based on ethylene.

“Ethylene went down. It was a big step and we didn’t expect it would be minus €100/tonne,” said one reseller.

The reseller quoted MEA at €1,350-1,400/tonne on an ex-works basis. It valued triethanolamine (TEA) at €1,400-1,450/tonne and diethanolamine (DEA) at €1,030-1,100/tonne.

“DEA is still tight and there is not so much available. People are covered and they are not booking contract - just spot,” the reseller said.

Another buyer and seller of ethanolamines in Europe described the start of the month as “quiet” and “uncertain”.

“It [the market] is a quiet and uncertain start for May due to national holidays. It’s quite slow due to ethylene and imports of MEA coming from Asia and Russia.

“MEA - there is a price change coming slowly, around €30/tonne down - sometimes more sometimes less. Some producers are saying down €50/tonne, but some customers still buying at April prices, but the trend will be some kind of decrease,” the trader source said.

Unlike comments from a producer, who felt MEA to be veering on the tight side, the trader described MEA as “quite long” and quoted imports at €1,350-1,370/tonne on a free delivered (FD) basis.

Regarding its demand, the trader added: “It was a good April, but it could be better. May I would say there are conferences and national holidays so it’s quiet slow.

”Because the first half of May is littered with public holidays across Europe, some sources said it would take another week or two to ascertain exactly where prices will be for each grade in May.

First indications from the market, following the ethylene settlement, suggested that producers were not prepared to reduce their prices since they wanted to retain as much margin as possible.

However, a producer said this week that it was moving its prices down by €30-40/tonne.

Another producer said it would not be changing its prices in May, while a third said it was a case of price over volume.

“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.

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 TEA.

($1 = €0.76)

By: Julia Meehan
+44 20 8652 3214

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