BERLIN (ICIS)--European mixed xylenes (MX) pricing is poised to see a drop in the fourth quarter amid unclear sentiment downstream and macroeconomic woes, according to sources on Monday and earlier this month.
“Some sellers were looking to push prices up in October but this didn’t fly,” one trader said on the sidelines of the 47th annual European Petrochemical Association (EPCA) meeting.
“We have also seen some aggressive selling in the distribution market, with prices moving below €900/tonne ($1,216/tonne) FCA (free carrier).”
FOB pricing is edging below $1,200/tonne so far this month, with a deal done in late September at $1,195/tonne and further downward movement expected.
“Tanks are getting full and you will see some lower pricing,” said one trader last week.
Weak pricing in both Asia and the US means that there is no global support for the European market, while European offtake has been limited by poor margins with downstream paraxylene (PX) and orthoxylene (OX).
“We are seeing oil prices move down still,” said another source. “The US economy is really shaky, which is why you see the low interest policy.”
Overall demand is largely dependent on sector, said one player in the distribution market, with construction increasingly healthy while automotive and resins continue to struggle.
The EPCA meeting runs from 5-9 October.
($1 = €0.74)