Europe July acetone spot price outlook for solvents is unclear

27 June 2013 17:17  [Source: ICIS news]

LONDON (ICIS)--The direction of European acetone spot prices in the solvents market and the level of demand expected in July is unclear despite a rollover of major feedstock propylene, sources said on Thursday.

In relation to the market moving from June to July, a trader said: “It’s a tricky time on the month. It's really quiet this week.

“The market will remain stable, but it might go down if demand is bad for solvents.”

A second trader described its acetone spot demand for June as “bad”.

“Demand in June was bad and nothing really happened to the price. From feedstocks, I don't expect much this month and it will depend on supply and demand and demand is not good,” said the trader.

“Now I am looking at July and acetone is not easy to get. One supplier is aiming for high numbers €840-860 FCA (free carrier alongside) which equals €880/tonne on a free delivered basis. If demand is strong we could see prices moving up a lot, like we saw in February,” the trader added.

In February, acetone prices reached €1,100/tonne FD (free delivered) NWE (northwest Europe) because of cuts in phenol operating rates, acetone exports to the US and good demand for major derivative methyl methacrylate (MMA).

A third trader also said its demand was slow and that in order to do any business it had to buy at €820/tonne FCA.

“€820 FCA seems a fair price for European material, but it's very difficult. Demand isn't all that great and July is looking quite weak,” the trader said.

Meanwhile, operating rates of primary product phenol continue to run at a low level because of poor demand for key phenol derivative, bisphenol A (BPA) into polycarbonate (PC) and phenolic resins.

European operating rates on phenol are estimated anywhere between 60-80%, depending on source.

For every tonne of phenol produced, approximately 0.62 tonne of by-product acetone is made.

($1 = €0.77)

By: Julia Meehan
+44 20 8652 3214

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