31 January 2014 17:44 [Source: ICIS news]
LONDON (ICIS)--The European February phenol contract is expected to settle up by €61/tonne, following the same increase in key feedstock benzene, sources said on Friday.
The February contract would then be valued at €1,609-1,649/tonne FD (free-delivered) NWE (northwest Europe).
The increase in prices will put a further dampener on an already troubled phenol market, with suggestions of more reductions in demand.
“We had a couple [of customers] shave off some volume [in anticipation of the price hike], but warned that they might need it on short notice,” said one producer.
“Any increase in benzene prices will lead to decreased demand. It’s impossible to move the magnitude of price increases, downward on the chain,” said one phenol buyer.
An initial European benzene settlement for February has been agreed at €1,055/tonne, up €61/tonne from the previous month.
The contract was agreed at a US dollar concept of $1,432/tonne FOB (free on board) NWE and converted to the euro price at the agreed exchange rate of €1:$1.3573. Further confirmation from other players is pending.
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