Sourcing issues for European mid-cut fatty alcohols continue

28 August 2013 23:59  [Source: ICIS news]

LONDON (ICIS)--Mid-cut fatty alcohol supplies remain scarce in Europe, with increasing numbers of buyers facing difficulty in sourcing material for September, sources said on Wednesday.

Many buyers had previously opted against covering their requirements for the entire third quarter, having expected prices to decline.

This has yet to occur, however, and the firm upward pressure continues to be felt on mid-cut prices.

A spate of plant shut-downs in southeast Asia, together with improved demand in China, has resulted in fewer volumes being made available to Europe.

One buyer said it paid €1,350/tonne FD ($1,800/tonne) (free delivered) NWE (northwest Europe) for mid-cuts for September delivery, adding that many suppliers it had contacted were close to selling out of material.

In spite of the limited supply, buyers remain hopeful that mid-cut alcohol prices will soften in time for the fourth quarter negotiation process.

Although palm feedstock prices are currently on the rise, it is hoped that the restart of fatty alcohol plants in southeast Asia over the past few weeks could help to alleviate some of the shortage being felt in Europe.

($1 = €0.75)

By: Neha Popat
+44 208 652 3214

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