US etac may rise on higher acetic acid

HOUSTON (ICIS)–Producers of US ethyl acetate (etac) are not ruling out possible price increases for etac due to higher feedstock costs, sources said on Monday.

Two separate etac producers said that tightening of the US acetic acid market has not hit the etac market – yet.

If acetic acid continues to tighten and prices increase, however, they would have no choice but to pass along the increases to their customers, the sources said.

“If the market moves a couple of pennies because of acetic acid, I think the market would accept that,” one producer said. “We’re talking about raw feedstock costs.”

The US etac market has long been described as balanced-to-long. In addition, etac prices last month saw increases averaging 2 cents/lb. That increase was grudgingly accepted in the market, with producers admitting that they did not get the full increases they intitally sought.

Buyers likely will not be happy about another increase so soon after the last increase. But, producers say raw materials costs could warrant it.

“If it continues to go up, producers may look to pass that increase along to customers at some point,” another producer said. “If that happens spot [prices] could go up right away.”

An etac buyer said that they have seen “no firm impact yet” on acetic acid increases.

“I was optimistic that etac was softening in the US,” the buyer said.

Current ICIS-assessed prices for ethyl acetate are 64-66 cents/lb ($1,411-1,455/tonne) for distributor prices and 58-60 cents/lb for spot prices.

Major US ethyl acetate suppliers are Celanese, Eastman Chemical and Solvay.