Europe June PX settlement confirmed at €930/tonne

Rhian O'connor

24-Jun-2014

Price riseLONDON (ICIS)–The European paraxylene (PX) contract for June has been confirmed on Tuesday at €930/tonne, up €30/tonne from the previous month, in line with the initial settlement seen early in the month.

The settlement was originally viewed by some buyers as too high

“It’s justified to be a bit higher in all fairness because in Asia it picked up quite a lot and we have a different exchange rate,” said one buyer earlier in the month.

“So maybe 30 [€/tonne] is too much but 20 [€/tonne] would be reasonable,” it added.

However, as Asia prices have continued to rise through the month, the European settlement has looked more reasonable.

“PX is $1,300 [/tonne] in Asia, so €930 [/tonne in Europe] is not bad. We have had worse,” said one buyer last week.

The timing of the initial settlement was also seen as positive after several months of non-settlement in Asia, causing late settlements in Europe.

“Its good to have had any early settlement, it keeps the process alive in Europe,” said a producer.

PX continues to be tight globally, with low operating rates in Asia drawing product in the region.

In addition, a force majeure in Italy has put specific pressure on southern European supply. As a result, Europe has seen rising spot prices despite low end-market demand.

The contract was agreed on a free delivered (FD) northwest Europe (NWE) basis.

Additional reporting: Caroline Murray

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