Isocyanates Europe

MDI

European crude methyl di-p-phenylene isocyanate (MDI) contract prices have been stable between February and March, but they were stable to slightly firmer in April, taking values to €2,060-2,150/tonne FD (free delivered) NWE (northwest Europe). The latter price move was attributed to margin recovery being weighed against subdued downstream demand and good supply. By contrast, pure MDI contract prices have trended upwards by €40-60/tonne between February and April, taking values to €2,230-2,260/tonne FD NWE. This upward price pressure was driven by robust demand from the downstream footwear sector.

The crude MDI market has been largely well-supplied, despite a spate of MDI output constraints, because downstream demand has been modest to slow for seasonal reasons in the first few months of the year and also amid economic constraints. The pure MDI market, however, has been more affected by MDI output limitations because of its lower yield as a co-product and because its demand has been better than for crude MDI.

In May, crude MDI prices are expected to remain fairly steady, despite higher upstream costs, amid fairly balanced market conditions. For pure MDI, stable to slightly firmer prices are likely, supported by ongoing short supply.

Updated to mid-May 2013

TDI

European toluene di-isocyanate (TDI) contract prices have been stable from February to April, but dropped by €50-60/tonne in May, taking values to €2,150-2,200/tonne FD (free delivered) NWE (northwest Europe).

Sellers had been keen to increase prices in February and April to recoup lost margins, but prices had mainly been agreed at a rollover, with only selective rises. This is because sellers’ attempts to push for margin recovery were being weighed against lacklustre demand and good TDI supply.

In May, however, TDI contract prices were pressured lower, amid cumulative relief in upstream toluene costs over the last few months and soft TDI market conditions. TDI demand in the main downstream bedding and furniture sectors had been lower than expected since the start of 2013 because of reduced consumer confidence and spending. 

This was also the case for the automotive sector. TDI’s main outlet in the automotive sector for flexible foam is in car seating. TDI supply has been plentiful, despite plant turnarounds for two suppliers, which took place in April. This is because they were planned, and downstream demand has been muted and export opportunities to the Middle East and Africa (MEAF) are not as attractive as in recent months because of intensified Asian competition.

Updated to mid-May 2013