04 June 2013 16:52 [Source: ICIS news]
LONDON (ICIS)--European methyl di-p-phenylene isocyanate (MDI) contract prices are likely to be largely steady in June, although slight firming is possible for pure MDI despite some feedstock relief, market players said on Tuesday.
Initial crude MDI settlements are so far showing rollovers following limited change in the benzene feedstock contract price and because crude MDI demand is holding up, although it is not as strong as it could be at this time of the year.
In addition, a proportion of MDI contract prices are fixed for the quarter so these prices will roll over into June.
The crude MDI market remains well supplied, despite recent and ongoing MDI output limitations because of a muted seasonal pick-up in activity.
The main downstream construction sector is normally in peak season during the spring and early summer because of better weather conditions. However, the seasonal uptick has been dampened to some extent this year by ongoing economic constraints.
One buyer said it had secured a slight reduction for its MDI contract price in June, but this was not confirmed by others. This price concession was seen to be selective and linked to low demand in parts of the Mediterranean because of more pronounced soft macroeconomic conditions in the region.
Pure MDI contract prices are likely to be stable to slightly firmer in June. Pure MDI market feedback so far showed a mix of rollover and increases of €10-20/tonne ($13-26/tonne).
Despite this, one producer conceded that its pure MDI contract prices in June were still largely steady within the existing range, with any increases absorbed within it.
However, rollovers are also likely and have been agreed on in some cases for June, depending on source and starting point as sellers are mindful of the implementation of successive price increases since the start of the year.
European MDI contract prices in May were assessed at €2,060-2,120/tonne FD (free delivered) NWE (northwest Europe) for crude MDI and €2,230-2,280/tonne FD NWE for pure MDI, according to ICIS.
($1 = €0.76)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections