26 November 2013 17:53 [Source: ICIS news]
HOUSTON (ICIS)--DuPont’s recent deal to sell its glass and vinyls business to Japan-based Kuraray could reduce the supply of vinyl acetate monomer (VAM) in the merchant market and drive prices up, a Latin American seller said on Tuesday.
The seller cited speculation in the market about US-based DuPont’s sale of its GLS/Vinyls unit to Kuraray for $543m (€402m), maintaining that Kuraray might use most of the material from DuPont’s US VAM unit in La Porte, Texas, for internal use.
“Our speculation is,” the Latin American seller said, “that it will reduce the number of suppliers, causing prices to rise. And that’s good for the business.”
US VAM spot prices, now at $930-1,030/tonne, are only about $30/tonne higher than they were at the start of the year.
The DuPont unit makes polyvinyl butyral and ionomer sheets for safety glass, plus VAM and polyvinyl alcohol (PVA) products for architectural, automotive and industrial applications.
In the deal announcement, Kuraray president Keiji Murakami stressed the company’s status as a PVA producer and marketer.
The supply side of the US and European VAM markets has brought headlines in recent weeks, with two plant closures in Europe – an INEOS unit in the UK and a Celanese plant in Spain – plus the sale of the DuPont business to Kuraray.
The top executive at Celanese said in late October than the shutdown of the INEOS plant would have a minimal impact on the VAM market because of so much excess capacity.
Helm will keep marketing VAM in North America for Kuraray as it has done for DuPont, a source close to the deal said on Tuesday.
Kuraray did not return a phone call immediately for comment, but a source close to the deal said that Helm has a long-term contract that will be supported by Kuraray.
Major US VAM sellers include Celanese, DuPont, Dow and LyondellBasell.
($1 = €0.74)
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