03 July 2013 23:59 [Source: ICIS news]
LONDON (ICIS)--European adipic acid (ADA) contracts for June have rolled over, buyers and sellers said on Wednesday.
The June contract decrease of €11/tonne for upstream benzene had very little effect on discussions.
June ADA contracts were unchanged at €1,755-1,810/tonne FD (free delivered) NWE (northwest Europe).
Market players are starting to concentrate on July negotiations now that upstream benzene has settled for this month.
Some sellers have announced an ADA increase for July. Last week one seller said it wanted to raise ADA prices by 8% in Europe, the Middle East and Africa with immediate effect.
Another seller, however, said that an increase was unlikely given current low demand levels and the size of the fall in the July benzene price of €67/tonne, which meant around a €40/tonne cost reduction for ADA manufacturers. It said it was aiming for a rollover of ADA prices. Some buyers said they thought prices might roll over.
Margins were described as close to disastrous by one supplier.
Demand overall remains weak, although some sources said that volumes into the engineering plastics sector have improved.
BASF has suspended the ADA line at its 260,000 tonne/year plant in Ludwigshafen, Germany, until downstream demand improves.
($1 = €0.77)
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