LONDON (ICIS)--Second-quarter European methyl methacrylate (MMA) contract prices have settled at a €60/tonne increase from the first quarter, sources said on Friday.
Prices are at €1,820-1,860/tonne FD (free delivered) NWE (northwest Europe).
Prices rose on the back of firmer supply and demand dynamics, and on margin recovery.
Demand from the coatings sector has improved as is normal during spring, and while the global market was expected to tighten versus the first quarter on planned and unplanned outages, supply constraints were exacerbated in recent weeks by the force majeure at UK-based Lucite International.
The 200,000 tonne/year MMA producer declared force majeure on 24 April because of a lack of feedstock at its Cassel plant. The force majeure remains in place, a source from the company confirmed this week.
Market participants said that they expected supply constraints to ease by the end of May, but this was unconfirmed by the producer.
Spot prices have surged since the middle of April on improved buying interest and limited availability.
May MMA contract price negotiations are ongoing.
“[There has been a] progressive tightening of the market,” a producer said. “The fact there was an unplanned shutdown was the tipping point.”
A buyer said: “Demand is a little better. It has increased over the past month. ... We are getting into the [peak coatings] season, it has started. What we see in our end market is that things are going OK.”
The buyer added that demand is similar to that seen last year. “Everyone is buying a bit, but it's not like 2007," the buyer said. "Still, with 1% growth, we're keeping our head above water. We hope to sell a bit more through the rest of the quarter.”
Nearly all MMA is polymerised to make homopolymers and copolymers, with the largest application being the casting, moulding or extrusion of polymethyl methacrylate (PMMA) or modified polymers.
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