SINGAPORE (ICIS)--Asia butyl acetate (butac) prices touched a seven-month high, bolstered by brisk import demand amid constrained spot availability, a scenario that is envisaged to extend into November.
Brisk trade activity in the week ended 16 October propped up the market, pushing up butac as well as related Asia ethyl acetate (etac) prices.
A combination of strong gains in feedstock acetic acid and n-butanol (NBA) values and curtailed regional production cutting into supply fueled market discussions throughout the week.
Constraints in spot cargo availability amid most facilities operating at lowered capacity prompted regional suppliers to raise asking levels for late-October/November parcels.
Strong gains in Chinese domestic etac prices fuelled market sentiment, as local producers also stepped up on price hike initiatives because of high feedstock ethanol costs and tight supply.
In east China, healthy domestic demand amid restocking activity lifted etac prices to yuan (CNY) 5,750-6,000/tonne ex-tank, up from the previous close prior to the Golden Week holiday at CNY5,680-5,700/tonne at end-September.
Malaysia’s PETRONAS Chemicals Group is operating its 50,000 tonnes/year butac plant in Kerteh, Trengganu at around 90% of capacity.
The producer has had to limit its spot cargo allocation owing to low inventories at a time when import requirements are increasing.
Reflecting brisk trade, butac shipments of around 500 tonnes were transacted at the low-$800s/tonne CFR (cost & freight) SE (southeast) Asia for end-October delivery.
Spot butac prices on a CFR southeast Asia basis averaged at $815/tonne as of 16 October, rising by $15/tonne from the preceding week and the highest level since 13 March, according to ICIS data.
In a similar vein, spot prices of etac rose to their highest in seven months, averaging at $815/tonne CFR SE Asia as of 16 October.
Planned maintenance is set to cut into production and is anticipated to keep overall supply in check with healthy demand to be sustained.
Japan’s Daicel Corp is conducting a scheduled turnaround at its 75,000 tonnes/year etac plant in Otake, Hiroshima until mid-November.
Focus article by Melanie Wee
Photo: At Ningbo Zhoushan Port in east China's Zhejiang province, 5 September 2020. (By Shutterstock)
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