22 October 2013 15:17 [Source: ICIS news]
The range is at €1,330-1,375/tonne FD (free delivered) NWE (northwest Europe). Some contracts rolled over or increased slightly, depending on starting point.
“We're very close to a balanced market,” said a producer that agreed most of its contracts at a decrease. “There is no justification for an increase, nor for a decrease. Given the market circumstances, it's the just outcome.”
Demand from the furniture and flooring sector is remaining steady, but activity in the pure particle board sector is slow. Panel producers are struggling with the low demand in the construction industry, a producer noted.
“We have absolutely no decreases,” another producer said. “It’s a balanced market. We have low inventory levels and that won't change through the quarter.”
Spot prices have dropped by €30-60/tonne since the settlement of the third-quarter contracts.
The producer went on to say that inventory levels across the value chain are low because of ongoing economic uncertainty.
“We have good offtake,” it added. “I expect the same in November. December has to be seen.”
Prospects for demand next year are mostly positive, or at least flat, buyers and sellers said. There is some expectation that demand next year will rise slightly in line with GDP.
A buyer said: “In our case, demand is steady with Q3, or a bit more. Our operation rates are very good and business is good for us. There shouldn't be any huge price jumps up or down in 2014.”
Players had hoped in 2012 that demand this year would pick up. It has varied through the course of the year, but market participants said overall consumption has been stable.
The first producer said: “Our orders are as expected, we are not dissatisfied. ‘Hope’ [that the market will improve next year] is long gone, it has turned to ‘waiting,’ because it will happen.”
Melamine is combined with formaldehyde to produce melamine formaldehyde resin. End-products include counter tops, dry erase boards, fabrics, glues, housewares, guitar saddles and guitar nuts.
($1 = €0.73)
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