01 August 2013 09:28 [Source: ICIS news]
LONDON (ICIS)--Initial August European toluene contracts have been agreed at $1,110/tonne, buyers and sellers confirmed on Thursday, up $62.50-67.50/tonne from last month’s range on firm spot indications and upward pressure from the US market.
Two consumers confirmed that they had agreed August contracts at $1,110/tonne late on Wednesday 31 July. One producer this morning said that it had settled August at the same number.
Contracts were settled on a free on board (FOB) northwest Europe (NWE) basis.
July saw European spot numbers creep up as gasoline values pushed well above $1,000/tonne FOB AR (Amsterdam-Rotterdam) on firm crude oil futures, which subsequently brought gasoline blenders into the toluene market as the spread between the two products widened and the economics became workable.
July spot deals were done as high as $1,097.50/tonne on an FOB basis before gasoline eased back below the $1,000/tonne mark, but firming US toluene prices kept some upward pressure on the European market.
Firm oil and energy numbers through July and healthy polyurethane (PU) demand has kept US spot numbers around the $1,170/tonne level, which in turn was keeping European sellers above $1,100/tonne.
“With numbers in the US around $1,170/tonne and $55/tonne freight costs, sellers are happy to keep offers high or either export the material themselves,” said one trader earlier this week.
($1 = €0.75)
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