30 August 2013 17:09 [Source: ICIS news]
LONDON (ICIS)--European butyl acetate (butac) producers are starting to announce September price targets despite the feedstock propylene contract not yet being settled for the month, they said on Friday
At least two are targeting price hikes, justified by an expected increase in feedstock costs and maintenance at upstream oxo-alcohols plants tightening the butac market.
“We’re targeting an increase of €30-50/tonnne [$39-66/tonne] to start with,” one producer said. “But there’s limited validity of these prices, [they’re for] 1-2 weeks until we know the C3 settlement.”
The source added that it has no urgent need to sell, and will therefore not be flexible with September prices.
A second producer said: “We will announce an increase in September, we [margins] are really suffering now [because of already-high feedstock costs].”
This source said it is waiting for the propylene settlement before deciding on a target, but talked of better-than-expected demand in August.
Butac producers say the market is now more balanced because of maintenance upstream.
BASF has a turnaround at its oxo-alcohols unit in Ludwigshafen, Germany, scheduled from mid-August to mid-September.
A three-week turnaround will be held in October at the Oxochimie oxo-alcohols plant in Lavera, France. The Oxochimie complex has a nameplate capacity of 150,000 tonnes/year of 2-ethylhexanol (2-EH), 150,000 tonnes/year of n-butanol (NBA) and 30,000 tonnes/year of isobutanol (IBA), according to ICIS data.
Inventories will be built up ahead of the shutdown, the company said.
However, according to a butac buyer, some Septmember butac prices have already been settled. This source argues that butac prices are linked more to supply and demand fundamentals than to feedstock prices.
It says it has already confirmed a deal with a major producer at a rollover from August.
($1 = €0.76)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections