15 November 2013 16:37 [Source: ICIS news]
LONDON (ICIS)--Both the European ethyl acetate (etac) market and those outside the region conducting business with it are anxiously awaiting the impact of the forthcoming change to European import duties, they said on Friday.
Participants in the Indian etac market last week spoke of an increase of import duties for etac from 2% to 5.5% in January 2014.
“Everyone is waiting to see what will happen with the import duty,” a European distributor said on Friday.
The new duties, which were approved by the European Commission, will go into effect in January,
European etac producers’ margins have suffered this year.
Rather than feedstock price movements, supply, demand and competition - particularly between European suppliers and importers - are deemed the main influences on European etac prices.
Lower-priced imports are frequently blamed for European producers' difficulties in increasing etac prices when feedstock values climb.
An increase in import duties, encouraging importers to raise their etac prices, could therefore have a considerable impact on the market.
Some distributors believe European producers will keep their prices stable in order to win customers back from importers.
“I think European producers will hold [prices] steady, it’s their only chance to sell more volumes,” one said.
However, a European producer said last week that it will seize any opportunity it can to raise prices and recover margins.
A Mediterranean distrubutor said on Friday that it has already seen its long-term agreements for 2014 affected by the change in duty, however further details of the impact are unknown.
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