US fatty alcohol Q4 contract negotiations underway

11 September 2013 21:08  [Source: ICIS news]

HOUSTON (ICIS)--Fourth-quarter US fatty alcohol contract negotiations are underway, although no price initiatives have been announced, buyers and sellers said on Wednesday. 

The lack of announced initiatives so far is a trend that has become commonplace in the US fatty alcohol contracting seasons over the past several years.

Price ideas were widely mixed between buyers and sellers in both heavy chain C16-18 alcohols and in the mid-cut C12-14 to C12-16 blended alcohols.

The mid-cut detergent-range alcohols of C12-14 to C12-16 blends were considered to be carrying some upward pressure, bolstered largely on good demand factors.

“We have seen some contract offers at 1-2 cents/lb up, but we have also had some offers at rollover from the third quarter,” one buyer said about the mid-cut alcohols.

General price sentiment on the heavy chain is that a rollover from the third quarter is likely to take place.

However, some buyers’ input points to lower price expectations.

“Some special deals are being cut,” one buyer said.

Mid-cut detergent range alcohol contracts were assessed at 83.50-96.00 cents/lb ($1,841-2,116/tonne, €1,381-1,587/tonne) for the third quarter.

Third-quarter heavy chain alcohols were last assessed at 80.00-92.00 cents/lb.

The US is a net importer of natural fatty alcohols, with most of the global production of these located in Asia.

Shell and Sasol produce detergent-range alcohols by synthetic processes in the US, respectively utilising ethylene and gas-to-liquids (GTL) chemical routes.

($1 = €0.75)

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By: Judith Taylor
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