European MEG March contract still unconfirmed, truck spot prices firm on demand

Source: ICIS News

2019/03/22

LONDON (ICIS)--The European monoethylene glycol (MEG) contract for March remains unconfirmed and talks are ongoing.

Meanwhile, in the spot market truck demand has been fairly steady, with some uplift in prices recently despite the anti-freeze peak season coming to an end.

For March contracts, sellers continue to be concerned about higher ethylene production costs after the European ethylene monthly contract reference price settled at €1,015/tonne, up by €30/tonne from February.

Previously, an MEG contract agreement for March emerged between a buyer and seller, but a 2+2 supplier and consumer agreement is required for full confirmation of the monthly contract price.

Historically, there has been a stalemate situation between sellers and buyers, resulting in discussions spilling into the next month, causing administrative challenges for the wider market.

SPOT PRICES FIRM
In the spot market, steady demand has caused some price firming, with fibre-grade prices quoted around €660-665/tonne FCA (free carrier) NWE northwest Europe); the the low end of the range currently representing technical grade material.

Truck prices were assessed at a €5/tonne increase at the low end of the range and stable at the high end, bringing prices to €655-665/tonne FCA NWE.

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Weather related issues in the US are causing some logistical difficulties for imports in the bulk spot market, with vessels from the US heading to Europe having been delayed by around one or two weeks.

Supply is more balanced as a result after a period of good availability.

Activity was fairly quiet this week, although there was some business done within the range.

Bulk prices have been assessed steady due to the lack of confirmed business.