17 May 2013 23:59 [Source: ICIS news]
The contracts were concluded on a free delivered (FD) northwest Europe (NWE) basis. Some prices were above and below the assessed range.
European contract prices saw moderate decreases this month, according to market participants. The fall was attributed to the substantial drop in the upstream ethylene May contract and continuing lacklustre demand for VAM.
One producer indicated that its May contract prices had fallen by up to €30/tonne, although it said that most of its business was concluded at €820/tonne FD NWE and above. The seller noted that demand from the construction sector was finally showing signs of improvement.
Another producer said it had concluded its May contracts at an average of minus €30/tonne, with €805/tonne FD NWE representing the low end of its business.
The source said that demand remained sluggish, particularly for emulsions, although the price cuts on VAM were mainly due to the effect of the ethylene drop.
The weather remains discouraging from a demand point of view, the source said, and June is likely to be the last chance for a recovery during the present season.
A third producer said its contract prices had fallen by €10-15/tonne, bringing its prices within the assessed range for May, but at the high end. The seller said that demand is picking up, though not as much as it had hoped.
A fourth producer said it would try to take advantage of the lower ethylene price to improve its margins, rather than cut prices. The source said it was seeing plenty of orders, and suggested that logistical issues could be delaying some deliveries.
Buyers indicated average price decreases of €30/tonne for May contracts, emphasising the impact of cheaper raw materials, good availability and weak demand.
Spot prices were assessed down by €20/tonne on Friday in the range of €800-820/tonne FD NWE.
($1 = €0.78)
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