Europe methylene chloride prices stable but market sharply divided

17 June 2014 23:59 Source:ICIS News

LONDON (ICIS)--European methylene chloride spot prices were assessed stable but market participants were sharply divided on the direction of the market, sources said on Tuesday.

Producers, citing margin recovery, continue to push for price hikes and increases up to €60/tonne quoted late last week. Some have said there have been early signs of success.

“We have been successful in increasing the price in many cases, so apparently things are moving in the right direction,” a producer said. It declined to provide absolute price levels.

A buyer disputed this and added increases are not currently possible.

“No, definitely no price rise… the downstream market would still not accept it,” the buyer said. “Demand is fragile [and] the significant decrease expected on methanol will help producers gain margin.”

Methanol prices have fluctuated between the fourth quarter of 2013 and the second quarter of 2014, prompting a second producer to note that the buyer is placing too much emphasis on the feedstock.

“[It is true that] methanol is a bit weaker but nevertheless when methanol was up, methylene chloride prices did not go up,” the second producer said, quoting prices within the current northwest European range.

Sellers also noted there are some supply issues with Dow’s facility in Stade, Germany, currently under maintenance and another producer citing unconfirmed production issues.

Northwest European spot prices were assessed stable at €480-530/tonne free delivered (FD).

By Stefan Naidu