25 October 2013 21:52 [Source: ICIS news]
HOUSTON (ICIS)--A tightening of global supply has led to an increase for US methyl ethyl ketone (MEK) spot prices, sources said on Friday.
ICIS-assessed US MEK prices went up 3 cents/lb ($66/tonne, €48/tonne) to a range of 76.00-80.00 cents/lb.
The increase was the first MEK price movement in four months and is an indication that global supply of MEK is tightening as demand is inching up. The last MEK spot price movement was a 2 cent/lb drop in June.
A tightening of MEK production in Europe due to a production outage has also led to global MEK demand increasing, sources said.
“Suddenly, there is a global of balancing act going on with MEK,” a source said. “Europe has reduced production, and that has tightened supply globally. We’ve definitely seen increases.”
In addition, there is sentiment that MEK contract prices could inch up next week as contracts settle.
In late September, Sasol announced an MEK price increase nomination of 3 cents/lb effective 15 October. Sasol was the second company to do so, as ExxonMobil also announced a 3 cents/lb increase for MEK effective 1 October.
Both nominations were initially met with resistance, as sentiment had been that MEK price increases were not warranted due to balanced supply and demand was balanced. In addition, prices for feedstock ethylene had been flat.
However, both nominations eventually found buyers as market sentiment has turned in recent weeks.
Eastman Chemical, the other major US producer of MEK, has not issued a recent price nomination.
($1 = €0.72)
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