27 November 2013 13:03 [Source: ICIS news]
LONDON (ICIS)--The European ethanolamines market will come under pressure in December as suppliers destock ahead of the year-end and also because of competitive offers of imported material, sources said on Wednesday.
“For December the market is already driven by huge over supply,” a trader said.
“Lots of producers are clearing stocks to finish the year close to zero - in general it’s a long market and tough competition. Even if ethylene [prices] moves up it won’t do anything to ethanolamines - there won't be any big changes,” the trader added.
While the market was still waiting for news relating to the December ethylene contract price, a major producer said it was rolling over its ethanolamines prices from November to December.
It said: “I see now the market situation will be rolling over prices to December. We are expecting ethylene to increase.
“We expect some weakening in monoethanolamines demand because demand for wood treatment will fall - so December is not the time to increase.”
In relation to its December business, a second producer said: “There’s not a massive change. For us we are producing as normal but since our maintenance break we’ve not had loads of stock.
“Sales are as they should be - no great shakes - not up or down and we will hold our prices - there is a little bit of downward pressure.
“If I say downward pressure it is a bit of an over statement - for us we're not moving down. What we have had €1,150-1,200/tonne [$1,554-1,622/tonne FD (free delivered) NWE (northwest Europe)] for DEA [diethanolamines]. I don't see that changing unless something major happens in the market place.”
The ethanolamines market is largely determined by supply and demand dynamics, but movements in major feedstock ethylene prices can also play a role in determining its value.
Ethylene moved down in November and despite rollovers being achieved at some accounts, November MEA and TEA prices also moved down because of price pressure coming from competitive offers of imported material from Asia and South America.
($1 = €.74)
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