Europe melamine Q2 contract talks to start in coming weeks
Katherine Sale
08-Mar-2017
LONDON (ICIS)–European melamine players are starting to look towards second-quarter contract negotiations, which are expected to start in the next few weeks, sources said on Wednesday.
Supply and demand dynamics traditionally dominate the discussions, with feedstock fluctuations having a lesser influence.
Supply is balanced-to-tight in Europe, driven by a drop in imports and healthy global demand.
Following the supply constraints in China last year, there remains some areas lacking material on reduced Chinese exports.
This has increased demand for European producers especially in areas such as Turkey, India and South America.
Domestic demand is also reasonable and is expected to increase in the second quarter, as is traditional for the period.
Imports in Europe have fallen again, mainly because of the ongoing production turnaround for Qatar Melamine Company, which has taken a little longer than expected.
The healthy demand and slight tightness in supply has resulted in some sellers saying they will be targeting increases for the second quarter.
However, at this stage targets are yet to be confirmed, as discussions will only start in the next few weeks.
There is potential for imports to increase once production resumes normal levels at Qatar.
First-quarter contract prices settled at
€1,410-1,490/tonne FD (free delivered) NWE (northwest
Europe), an increase of €50-70/tonne from the fourth
quarter.
Focus article by Katherine
Sale
(Picture source: Image
Source/REX/Shutterstock)
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