HOUSTON (ICIS)-- Isopropanol (IPA) prices continued to decline this week due to increased supply.
Demand has stayed higher than before the coronavirus impacted IPA markets in March. However, supply lengthened in July.
Even large buyers were on some form of sales control until recently, but most of those had been entirely removed by producers in the past several weeks.
One major producer reduced prices by more than 25 cents/lb in the past two weeks. While this was greater than the cuts of others, the past two weeks have seen significant price reductions.
Domestic prices fell 5 cents/lb ($110/tonne) are now assessed at 80-100 cents/lb ($1764-2205/tonne) delivered (DEL) US Gulf.
In spot markets, prices fell even further. Prices were down 13 cents/lb on the low end of the market and 10 cents/lb on the high end. Spot prices are now assessed at 77-95 cents/lb FOB US Gulf.
The chart below shows domestic and spot IPA prices as of 23 July.
Some players observed prices that were even lower than this week's assessed prices. However, those were believed to be outliers either due to unique circumstances of the proposed deal or the size of the deal being in quantities that would not be available for most market participants.
Due to recent changes, there are instances where spot prices are below quarterly negotiated contracts at the moment. Although this occurred prior to the surge in IPA prices in March, this marks the first time it has happened since then.
Although there were several reports of tight supply in the West Coast, others said that only applied to players seeking large bulk loads.
Although Korean, Taiwanese, and Chinese producers are still importing IPA, their quantities are decreasing. This is especially true with Chinese IPA, which saw the lowest price in Q2. Its pricing gap is no longer as wide due to lower US prices.
Spot export prices have not been assessed this week, pending further market feedback.
US IPA suppliers include ExxonMobil, Dow Chemical, LyondellBasell, Monument Chemical and Shell Chemical.
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