Demand for MPG increasing as winter approaches

20 September 2013 15:49  [Source: ICIS news]

LONDON (ICIS)--European monopropylene glycol industrial (MPGI) grade demand is on the rise as the de-icing industry looks to replenish stocks in preparation for the winter, sources said Friday.

“We have some spot business from de-icing,” a producer said. “They are preparing for winter [as] they have low inventories [after last season].”

A trader also said it has received some de-icing enquiries, adding this was unusual as the industry normally buys in spot market only when inventories are low during the winter season, not in autumn. The majority of de-icing business is done on a monthly contract basis.

The average spot price in northwest Europe has risen steadily since the beginning of August, according to ICIS data. In late July, prices were assessed at €1,130-1,180 FD (free delivered) NWE (northwest Europe) and firmed to €1,170-1,230/tonne ($1,581-1662/tonne) FD NWE last week.

“In the beginning [of September], MPGI prices were driven up by [rising] feedstock [prices],” the trader said.

“Now, [the upward price momentum] is demand driven,” he added.

Earlier this month, monthly propylene contract prices firmed by €60/tonne to €1,150/tonne for September business.

Monopropylene glycol is used in the manufacture of de-icing fluid as it has a low freezing point. Major producers include Dow, BASF, LyondellBasell  and Repsol.

($1 = €0.74)

By: Stefan Naidu
+44 208 652 3214

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