30 October 2013 23:59 [Source: ICIS news]
LONDON (ICIS)--The conclusion of the European propylene November contract at a decrease of €30/tonne ($41/tonne) from October has undermined sentiment in the downstream oxo-alcohols market, sources said on Wednesday.
Market participants said that price decreases were likely as a result, although demand remains fairly healthy for the time of year.
A buyer said it had received offers for November delivery of 2-ethylhexanol (2-EH) at prices that were €20-30/tonne below October levels, in the mid-€1,300s/tonne FD (free delivered) NWE (northwest Europe).
This was in line with prices heard from another buyer last week for October delivery, although other sources indicated prices in line with the assessed level.
Another 2-EH buyer said that suppliers had been attempting to allocate tonnes, implying that there is some additional volume in the market. The source noted that market participants will aim to reduce their inventories towards the end of the year.
A third buyer said it is accepting its usual quantities of 2-EH.
A producer acknowledged that it would have to accept price reductions in order to sell tonnes on the spot market. The source said that a 2-EH price target of €1,450-1,460/tonne FD NWE for November was possible, compared with €1,480/tonne FD NWE in October.
N-butanol (NBA) prices would probably fall to €1,120-1,130/tonne FD NWE from the October level of €1,150/tonne FD NWE, the source said. There is no sign yet of a seasonal decline in demand, the producer added.
A second producer indicated spot prices at unchanged levels of €1,120-1,130/tonne FD for NBA and €1,020-1,030/tonne FD for isobutanol (IBA).
A third said it did not see any justification for November price decreases, given good demand and producers' difficulty in raising prices during the summer.
Spot prices were assessed by ICIS on Wednesday at €1,120-1,170/tonne FD NWE for NBA, €1,020-1,080/tonne FD NWE for IBA, and €1,400-1,470/tonne FD NWE for 2-EH.
($1 = €0.73)
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