04 November 2013 10:49 [Source: ICIS news]
LONDON (ICIS)--European toluene contracts for November have been confirmed at $1,020-1,025/tonne (€755-759/tonne), down $92.50-95.00/tonne from the previous month’s range, as the initial settlements heard last week received further support from players on Monday.
One major consumer initially reported late on Thursday 31 October that it had agreed November volumes at $1,020/tonne. This was followed by news of a settlement at $1,025/tonne between one supplier and several of its customers.
Other buyers and sellers confirmed this week that they had agreed November volumes within the above range.
European spot values saw a sharp drop over the course of October in line with global aromatics losses and weakening oil and energy costs. Buying interest from the gasoline blending sector was assessed around the $1,000/tonne level, given recent FOB AR (Amsterdam-Rotterdam) gasoline prices in the low $900s/tonne.
Spot offers have held around the $1,050/tonne, so the November contracts were settled around the midpoint of the buy/sell range.
However, one supplier felt that the market was starting to reverse the downtrend seen so far in the fourth quarter. There was a sharp upturn midweek in the US market alongside renewed buying interest, and also talk of a European spot deal done at $1,040/tonne, although this remains unconfirmed.
Another seller agreed, adding that there was some emerging interest for European material from buyers in the Middle East.
Similarly, the Asian toluene market saw some upward movement towards the end of the month, as Chinese import demand improved, but overall sentiment remains bearish. Some restocking among traders was seen, with many sensing that the market had reached the bottom in terms of pricing. However, demand for the rest of the year is likely to stay subdued.
Demand in the European toluene di-isocyanate (TDI) market remains lacklustre despite the traditional seasonal upturn in September and October, although opinions differ on availability in the fourth quarter amid production problems.
($1 = €0.74)
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