The February phenol contract is valued at €1,609-1,649/tonne FD (free-delivered) NWE (northwest Europe).
Phenol operating rates have been reduced since July 2012 because of a lack of exports to Asia, weak macroeconomic conditions and poor demand for major derivative bisphenol A (BPA).
The price increases are said to put further downward pressure on operating rates.
“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 on Friday 31 January.
“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 on 31 January.
The phenol contract in Europe is largely linked to feedstock benzene price, although a quarterly fee, also known as the adder, is also an influencing factor for some producers and consumers in Europe
The European benzene settlement for February was confirmed 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 (northwest Europe) and converted to the euro price at the agreed exchange rate of €1:$1.3573.