China acetone prices surpass India, first time since 2014

MELBOURNE (ICIS)–Spot acetone prices into China surpassed those into India for the first time since late August 2014, ICIS data showed.

Spot CFR (cost & freight) China acetone prices closed at an average of $587.50/tonne CFR China on a zero antidumping duty (ADD) basis, subject to import duty, in the week ended 22 July, following two weeks of rally, according to data compiled by ICIS.

In comparison, the prices into India were assessed at $582.50/tonne CFR India for the assessment week ended 20 July, ICIS data showed.

Against a backdrop of rising supply in Asia, the CFR China acetone prices climbed on the back of a confluence of renewed Asia-to-US arbitrage, resilient upstream propylene prices and the strong domestic market rebound ahead of the G20 Summit.

Raw material propylene prices in northeast have held well above $700/tonne CFR NE Asia since mid-April, ICIS data showed.

Acetone availability in Asia outside China has been boosted by capacity expansion in Thailand and South Korea, alongside increased phenol/acetone capacity utilisation in Singapore and Taiwan.

Mitsui Phenols Singapore may be in a position to raise its phenol/acetone output to around 90% capacity in August as its raw material supply gradually returns to normal.

And in Taiwan, Taiwan Prosperity Chemical Corp (TPCC) plans to maintain its phenol/acetone plant run rate at 60% capacity in August, after stepping up its output to this level in June.

Nevertheless, the underlying supply/demand fundamentals in Asia are garnering further support from continuing US demand for Asian material.

After selling 15,000-16,000 tonnes to the US for loading in July/early August, several Asian producers received further enquiries for August-lifting material.

Two northeast Asian producers have sold a combined 6,000 tonnes of acetone to the US for loading in August. Two other producers were heard to be undertaking discussions for sale to the US.

Tight acetone availability in the US has sustained US demand for imports from Asia, said an Asian phenol/acetone maker.  

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

Top image: paint brushes. Acetone is used as a paint thinner; Source (Photographer Image BROKER/REX/Shutterstock)

By Trisha Huang