US HCl rises by 17% amid tight supply

Bill Bowen

14-Sep-2017

Arrow upHOUSTON (ICIS)–US hydrochloric acid (HCl) prices climbed during the week as an already thinly supplied market contended with the disruptions of Hurricane Harvey and its aftermath, according to the ICIS assessment on Thursday.

US prices were assessed higher by an average of $20/wet ton as separately proposed producer price increases continue to be implemented by buyers. The new range of $130-150/wet ton ex works US Gulf reflects the full range of market prices, including spot and contract business.

Plant outages caused by Harvey have contributed to what was a thinly supplied market in July and August, as unplanned outages and scheduled maintenances met rising demand from increased oilfield activity.

Delivered prices to the oilfield buyers appear to have moved above $300/wet ton in many cases, depending on distance from the supplying plant or terminal.

Producers separately proposed increases of $35-50/wet ton in late July and early August as the supply situation became more acute.

Spot purchases are heard to have accepted almost all of producers’ separately proposed increases.

Contracts are taking a significant portion of the increase, depending on other terms, including contract term length.

Contracts for long terms and for large volumes are currently immune to the current volatility, but may see increases later, especially at 1 January 2018.

 Major US HCl producers include Olin, Occidental Chemical, BASF, Covestro, Chemours, Formosa Plastics, Huntsman and Westlake Chemical.

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