17 September 2013 15:55 [Source: ICIS news]
LONDON (ICIS)--European base oils prices are too expensive for the Black Sea market, sources based in Turkey said on Tuesday.
“We are trying to take material from Europe but it’s higher than what our customers are willing to pay,” said a buyer for the Turkish market. “We are trying to sell at $1,000/tonne. For SN500 this is not competitive.”
Demand for base oils in Turkey is steady, but a number of sources believe that a lot more business could be done if European producers were to offer lower euro prices because of the weak Turkish lira.
“The lira is making everything very expensive for us,” commented another base oils buyer.
Although the Turkish lira saw its biggest one-day gain on 16 September since October 2010, year-on-year the lira has lost 17% of its value against the US dollar and has dropped by 12% since May this year.
There is some optimism in Turkey following the appreciation of the lira, but most sources there said they had seen not seen any notable change in their base oil demand from one week to the next.
“The market is quiet and there really is nothing new to say,” said a trader source. “I don’t sense any tightness in the market and people are generally covered.”
A second trader also described the Black Sea base oils market as “steady” but “quiet”.
“The market is steady, but it feels quiet. People have bought now and it’s too soon to say what will happen in October,” the trader said.
The price for SN150 and SN500 FOB (free on board) Black Sea base oils has been determined by ICIS at $885-925/tonne (€664-694/tonne).
A third Europe-based trader looking to buy in the Black Sea, with an eye to selling to India or Middle East, said it had received some offers at the higher end of the ICIS ranges.
($1 = €0.75)
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