Price and market trends: Asia mid-cut fatty alcohols hit one-year high on firm PKO prices

06 December 2013 09:54 Source:ICIS Chemical Business

Asia mid-cut fatty alcohols hit one-year high

Spot mid-cut C12-14 fatty alcohols prices in Asia hit a one-year high in the week ending 29 November, after nearly a month of inactivity because of volatility in feedstock costs.

On 27 November, C12-14 fatty alcohols were assessed at $1,650-1,880/tonne (€1,221-1,391/tonne) FOB (free on board) SE (southeast) Asia for December loading, up by $100-180/tonne from the previous week, according to ICIS data.

A few downstream end-users in the region were heard to be covering their requirements in the week, with transactions done at around the lower end of the published range.

More activities are expected in the upcoming weeks as negotiations are ongoing with buyers.

Producers are mostly bullish because of restocking activities and firm upstream palm kernel oil (PKO) prices.

Offers were heard mostly at above $1,700/tonne FOB (free on board) SE (southeast) Asia, with some being quoted at as high as $1,900/tonne FOB SE Asia.

“Prices of PKO have been on an uptrend since October and have not softened for the past few weeks,” said a Malaysian fatty alcohols producer.

On 27 November, PKO prices stood at $1,057.80/tonne, up by $37.56/tonne from the 
previous week.

Mid-cut fatty alcohols prices are expected to be supported by demand and tightening inventory, market sources said.

A few industry participants, however, are cautious about the overall market directions, expecting palm oil prices to correct and stabilise PKO prices in the coming weeks, thus rein in the bullish mid-cut fatty alcohols prices.

C12-14 fatty alcohols go into surfactant and chemical intermediate production.

By Alexis Gan