03 September 2013 22:35 [Source: ICIS news]
HOUSTON (ICIS)--US maleic anhydride (MA) contracts for September have started to settle at a rollover, sources said on Tuesday.
Buyers and sellers said contract prices would stick between the 77.2-83.2 cents/lb ($1,702-1,834/tonne, €1,294-1,394/tonne) for molten material on an FOB (free on board) basis done for August.
Sources said the rollover was fuelled by producers allowing buyers to restore margins.
“Maleic was overpriced relative to butane earlier this year,” a buyer said. “Tight supply is also keeping the contract from falling.”
Sources said that if not for the margin restoration, prices would have room to settle higher because of surging feedstock costs and tight supply.
US normal butane spot prices climbed to $1.43/gal at the end of August from $1.33/gal at the start of the month.
“N-butane prices more than justify a price increase in October,” a producer said. “But September is likely to roll over.”
Buyers and sellers agreed that supply also remains tight because of several unplanned plant outages throughout the summer.
However, US MA prices remain below overseas prices because n-butane is a cheaper feedstock than benzene, which is the dominant feedstock overseas.
“There’s still US stuff moving to Europe,” a producer said. “But there’s very little coming over here. That’s adding a bit to the supply tightness.”
Demand is holding steady, sources said, but is not driving prices higher or allowing for price relief.
Major US MA producers include Ashland, Flint Hills Resources, Huntsman and LANXESS.
($1 = €0.76)
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