16 October 2013 23:41 [Source: ICIS news]
HOUSTON (ICIS)--US melamine prices for the fourth quarter contract settled at a rollover this week after prolonged negotiations, sources said on Wednesday.
The US market’s sole producer, Cornerstone Chemical, had sought a price increase of 2 cents/lb ($44/tonne, €33/tonne) on strong demand and shortened supply.
But buyers haggled and prices held within the ICIS-assessed range of 83-93 cents/lb FOB (free on board) USG (US Gulf), as buyers pointed to available product imported from China at 72-75 cents/lb and from Europe priced at Q3 levels.
Supply also remained sufficient. Several plant turnarounds in Europe, the Middle East and the Caribbean during August and September had thrown the supply part of the equation into question. But buyers were able to source enough material to meet demand and to effectively hold off any price increase.
Some supply questions remain unanswered. Plants in Poland and Trinidad and Tobago were slated for restarts this week after prolonged maintenance turnarounds.
But a restart at one unit of the Pulawy plant in Poland was put on hold this week due to a lack of liquid urea. Production at the Methanol Holdings plant in Trinidad and Tobago was to restart in early October, but it could not be confirmed by Wednesday whether that restart was going ahead as previously scheduled.
The market was also complicated by Washington’s stalemate over the US budget and the nation’s borrowing limit.
Some buyers said that end-user demand may have been blunted during the first half of October over worries about the macroeconomic uncertainty imposed by the debate and the third week of a federal government shutdown.
Demand had been said to be strengthening in September with steady pull from construction activity and strong production of fibreboard, finished panels, laminates and flooring. Paints and coatings demand has been described as strengthening with demand from the auto sector.
Additionally, seasonal slowing of construction will likely begin soon as weather conditions begin deteriorating in the northern regions of the US and Canada as winter approaches.
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