15 November 2013 15:29 [Source: ICIS news]
LONDON (ICIS)--European phenol demand is starting to slow ahead of the year-end as buyers attempt to close out 2013 with minimal stocks, buyers said on Friday.
“In terms of phenol consumption [for 2014] we don't see big differences [compared to 2013]. What is different is the second half of November and December , we are now sure our consumption will be lower than some months ago,” said a large buyer.
“We will close the year under expectations,” it added.
Another major buyer of phenol said it is also seeing its demand slow.
“Demand is slowing, for sure,” the buyer said.
Demand for phenol into major phenol derivative BPA (bisphenol A) has been low because of poor demand for BPA derivatives such as polycarbonate (PC) and epoxy resins.
The BPA, PC and epoxy resins have all been exposed to the same negative effects of cheap imports from Asia and slowing demand from the construction and automotive sectors.
Producers of BPA and epoxy resins are quoted as saying that it is now cheaper to buy boths material than to produce them in Europe at the moment.
Looking ahead to 2014, major buyers of phenol say that benzene will hold the key to the success or failure of the phenol business.
Benzene is a key raw material for phenol production.
Talking about 2014, a major BPA producer said: “I don't know, but one thing it clear, it will not be worse - some people are optimistic - I don't know why.”
The buyer added that the key to the success of the European phenol chain is that benzene prices stay low in Europe and that European benzene remains cheaper than in the US and Asia.
Europe is currently the cheapest-priced region for spot benzene.
($1 = €0.74)
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