US March EG rolls over, DEG rises, TEG falls

14 March 2014 22:54 Source:ICIS News

NEW YORK (ICIS)--US ethylene glycol (EG) contract prices for March rolled over, sources said on Friday.

EG industrial-grade (EGI) contract prices were rolled over at 53-54 cents/lb ($1,168-1,190/tonne) FOB (free on board) in March from February, market sources confirmed.

EG fibre-grade (EGF) contract prices for March were also rolled over at 49-50 cents/lb FOB from February.

The steady price trend follows Asia MEG contract pricing, which remained steady in March from the previous month.

For the purpose of the ICIS assessment, US contract prices represent levels paid by distributors on an FOB plant basis prior to any discounts, incentives or terminal upcharges.

Diethylene glycol (DEG) contract prices for March were assessed up by 2 cents/lb to 55-59 cents/lb FOB from 53-57 cents/lb FOB in February.

Several sources confirmed that their prices increased on the back of the market tightening from significant volumes exported in the last two months of 2013. Those exports have taken a hefty amount of material off the US market as US suppliers took advantage of a boost in demand and stronger pricing in Asia at that time.

Demand was strong particularly in China, where DEG was needed for the increased production of solar powered cells and to fulfil unsaturated polyester resin (UPR) demand, according to market sources.

Triethylene glycol (TEG) contract values for March fell from the previous month as demand has begun to decline.

TEG prices are at 91-122 cents/lb FOB from 112-123 cents/lb FOB in February.

At least one producer said it has been reducing its TEG prices since January because it had already been seeing demand come down.

TEG prices are expected to fall even more drastically from now through the summer, which is the off season for TEG. Prices typically fall as low as 80 cents/lb FOB in the off season to close any arbitrage window from cheaper imports, market sources have said.

Major EG producers in the US include BASF, Dow Chemical, Eastman Chemical, Formosa Plastics, Huntsman, Indorama Ventures, LyondellBasell and Shell Chemical.

By Feliza Mirasol