09 August 2013 09:28 [Source: ICB]
As feedstock propylene prices rise, producers seek increases of €30-50/tonne for August
Acrylic acid (AA) and acrylate esters producers in Europe are seeking August price rises on the back of higher feedstock costs and tight butyl acrylate (butyl-A) supply, sources said on 31 July.
The August feedstock propylene contract price increased by €50/tonne ($67/tonne) as a result of a firmer upstream market, while supply and demand fundamentals are stable.
Acrylates producers are seeking hikes of €30-50/tonne for AA and all acrylate esters, apart from butyl-A, where higher prices will be targeted because of healthy demand and limited availability.
Targets of €50-100/tonne over July prices are being sought by producers for butyl-A for August.
"We will be recouping the propylene increase," a producer said, adding that the timing is difficult with holidays now taking place. "Butyl-A remains very tight. Everyone is searching for volumes in Europe and further afield. There is strong demand and the same level of tightness in August [as in July]."
Another producer said: "The market is pretty long, except for butyl-A. There is not much activity, it's clearly the holiday season." The producer is aiming to achieve increases across all esters to compensate for the propylene price rise. It will aim for higher price increases on butyl-A. "Butyl-A is very hard to get," it added.
Sales control on butyl-A at BASF will remain in place into August, a source from the company said last week, adding that beyond that it was not yet clear how long the sales control would be in place. The company is fulfilling its contractual obligations.
BASF implemented force majeure on butyl-A on 13 June because of production problems at its 110,000 tonne/year Ludwigshafen facility in Germany. It was lifted on 21 June and sales controls were put in place.
Dow Chemical began a four-week turnaround at its 80,000 tonne/year AA plant in Boehlen, Germany, three weeks ago. The outage is also affecting its 40,000 tonne/year butyl-A production.
Demand for all other esters is steady, although some softening is expected in August as a number of players will be on holiday, and some manufacturers will shut as is traditional during August, particularly in the south of Europe.
Acrylate esters availability - excluding butyl-A - is balanced to long.
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