Q4 US glycerine hike may be mitigated by steady Asia pricing

04 September 2013 21:50  [Source: ICIS news]

MEDELLIN, Colombia (ICIS)--Higher price ideas for fourth quarter contract pricing in the US refined glycerine market could be mitigated by steady pricing in southeast Asia.

All eyes are watching price direction in southeast Asia for an idea of where US pricing will go, sources said on Wednesday.

The US is a net importer of refined glycerine, with most of its supply coming from southeast Asia.

Asia's refined glycerine prices are expected to stabilise in the fourth quarter amid tight supply, higher feedstock prices and a possible seasonal pickup in demand, market sources in Asia said.

However, some buyers and traders in the region are sidelined because they are concerned that supply will increase after several fatty acid and fatty alcohol plants complete their scheduled maintenance.

Meanwhile, producers in the US are running at maximum operating rates as demand is described as healthy across all sectors and oleochemical producers actively participating in the tallow spot market, according to market players.

Negotiations for pricing are expected to begin in the coming weeks.

Most refined glycerine contracts are presently done on a quarterly basis with a few shorter term and longer term contracts.

End-use segments in food and beverages, tobaccos, pet foods and industrial tiers are all said to be performing well and underpinning the snugness in the refined segment.

US refined glycerine suppliers include Procter & Gamble, Vantage Oleochemical, Emery Oleochemical, Twin Rivers Technology and Peter Cremer North America.

Major importers include Wilmar, Acme-Hardesty and several trading groups.

By: Leela Landress
+1 713 525 2653

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