Europe MEA spot prices under pressure from cheap imports

05 June 2013 15:32  [Source: ICIS news]

LONDON (ICIS)--European monoethanolamine (MEA) spot prices are under pressure from competitively priced imports from Asia and other regions, while diethanolamine (DEA) and triethanolamine (TEA) remain stable, market sources said on Wednesday.

“DEA and TEA [prices] looks like they will be stable again. Maybe a kind of rollover from May, but there is more pressure on MEA,” a trader source said.

“Imports are increasing and MEA is offered at low numbers -  around €1,320/tonne. The big chunk is coming from Asia but there is also material coming from Brazil and directly from Mexico,” the trader added.

The trader also said that in order to “move MEA”, some European producers had to offer it as low as €1,250/tonne.

A second trader source also had similar views in terms of price pressure on MEA in June.

“We see prices down a little for MEA and maybe DEA but I am not sure about TEA, but I don’t have a good feeling about any market for June at the moment.”

Although the value of MEA appears to be under pressure from cheap imports, most sources did not expect to see too much change in relation to the price of spot diethanolamine (DEA) or triethanolamine (TEA).

However, on a contractual basis, one major buyer of TEA said it was pushing for a “big” decrease from May to June.

The major buyer, consuming TEA for the esterquat (clothes softener) market, said that it expects to see its monthly contract price fall by €70-80/tonne from May to June.

“The spot market is moving down more than the contract market so there is more pressure on contract numbers,” the major buyer said.

“Spot prices moved down by €100/tonne. For June we will be pushing for a big decrease. Producers think this is a big jump, but will see,” the buyer added.

Meanwhile in Asia, prices are stable but trading activity is described as subdued.

Similar to the picture painted of the European market, Asian MEA is under more pressure than Asian TEA and DEA, because demand for both of these grades is better compared to MEA.

Buying habits in Asia are also very much on a hand-to-mouth basis for all three grades.

Back in Europe, May ethanolamines contract prices moved down following the larger-than-expected drop in the value of major feedstock ethylene.

The June ethylene contract price settled up €5/tonne.

Ethanolamines can be used for applications such as agrochemical production, surfactants, personal care and construction. MEA is produced by reacting ethylene oxide (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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