Mideast flex polyols stable; limited scope for price hikes

SINGAPORE (ICIS)–Spot flexible polyether polyols prices in the Middle East, including the Gulf Cooperation Council (GCC) region, were stable during the week on unchanged market fundamentals.

On 26 November, drummed 10-13.5% polymer polyols (POP) prices were assessed at $1,550-1,600/tonne CFR (cost and freight) Middle East, stable week on week, according to ICIS data.

Prices of bulk cargoes were assessed unchanged at $1,500-1,550/tonne CFR Middle East over the same period.

Conventional polyols prices, meanwhile, were at $1,500-1,550/tonne CFR Middle East in the week ending 26 November, ICIS data showed.

Sellers said they were unable to increase the market price but had to at least maintain their current offers in order to avoid losses. One northeast Asian supplier said it was not offering material to the Middle East, instead it was focusing on its domestic market to clear its current stocks. The supplier added even at current price levels it would make losses.

China-based suppliers remained under pressure of high feedstock propylene oxide (PO) costs, but some added they had to offer their material within the published price ranges in order to maintain their presence in the market.

Market players said there was limited impact following a European supplier’s (Covestro) declaration of force majeure on its ethylene oxide (EO)-containing polyether polyols products, because the EO content in flexible polyols was less than 10%.

Covestro had declared the FM on 18 November but suspended it on 25 November at its plants in Antwerp, Belgium, and Dormagen, Germany, a source at the company said on 25 November.

The force majeure resulted from two upstream force majeures elsewhere that impacted the supply of feedstock ethylene oxide to Covestro.

Looking forward, some sources said buyers would be trying to keep lean financial books at the end of the year and only purchase polyols on need to basis. Whereas sellers would try to meet year-end sales targets and close as much business as possible.