SINGAPORE (ICIS)--Asia’s ethyl acetate (etac) prices halted steady decline since October 2018 on the back of gains in feedstock acetic acid in China's domestic market.Ethyl acetate (etac) is used in coatings, pharmaceuticals and solvents. (Photo by David Cole/REX/Shutterstock)
Activity in the Chinese market was slowing down with some downstream plants shutting down ahead of the Lunar New Year holiday in early February.
But sellers were optimistic that a rebound in feedstock and etac prices before the holidays set the mood for future discussions when buyers return from the holidays.
The Lunar New Year, which falls on 5 February this year, is celebrated on most parts of southeast Asia and northeast Asia. China will be on holiday for a full week on 4-10 February.
In the week ended 25 January, spot etac prices in Asia were assessed at an average of $795/tonne FOB (free on board) China, up by $5/tonne from the previous week, according to ICIS data.
Feedstock acetic acid spot prices in the region had limited movement over the same period, while sellers’ sentiment in China turned bullish causing a rebound in domestic prices.
Whether etac gains could be sustained would depend on the market direction of feedstock acetic acid.
However, demand for acetic acid in Asia remained generally weak amid higher-than-typical inventory level in India.
Etac in the region, on the other hand, was largely slow at the start of the year and ahead of the Lunar New Year holiday.
China is a major exporter of etac in Asia, with total shipments in 2018 at 457,383 tonnes.
On the supply side, some Chinese etac plants will reduce operation or shut down during the holiday and sellers were under no pressure to offload inventory.
In Singapore, Celanese’s etac/butyl acetate swing plant will also shut for a turnaround in end-February.
Focus article by Li Li Chng