Prices, sentiments mixed in Asia market
The prices of fatty acids in Asia are assessed at a wider range this week, with some acid groups showing a decline in prices, and other showing an increase. Sentiment was also mostly mixed as many players were divided on future price trends.
Some expect that prices will remain firm for most acid groups because of a reduction in fatty acids production, while others said the prevailing weak demand will lead to lower prices.
Local feedstock prices were mostly stable, although the volatility in the forex markets raised the US dollar equivalent of most local feedstocks prices this week.
Fractionated fatty acids
Prices in the C8 caprylic acid market are flat at $3,350-3,400/tonne FOB SE Asia in a quiet market. Market fundamentals remain unchanged, with trading activity limited to the usual contracts.
Meanwhile, the prevailing weak demand for C10 capric acid caused prices to decline by $50/tonne to $1,450-1,500/tonne FOB SE Asia this week, in line with bids and offers heard.
C12 lauric acid prices are assessed as up by $50/tonne at the high end of the range at $1,400-1,500/tonne FOB SE Asia. Market sentiment remains mixed for the pricing trend of C12 lauric acid. Some producers with ample cargoes for August were offering cargoes at $1,450-1,500/tonne FOB SE Asia while those with limited supply were targeting selling ideas at $1,500-1,550/tonne FOB SE Asia.
Some market players said that because of the weak demand in the C12-14 fatty alcohols sector, more supply of C12 and C14 acids was available.
Trading activity in China's C12 lauric acid market remains subdued as buyers are staying on the sidelines and waiting for lower prices. The prices of locally produced C12 lauric acid are assessed at a narrower range, at yuan (CNY) 12,500-13,000/tonne EXW, this week.
Prices of C14 myristic acid firmed by $50/tonne at the low end of the range to $3,500-3,550/tonne FOB SE Asia on the back of higher bids and offers heard. Demand was stable, with buyers expecting the tight supply of C14 myristic acid to ease in the coming weeks.
The prices of locally produced C14 myristic acid in the Chinese market are stagnant at CNY28,000/tonne EXW, this week.
C16 palmitic acid prices are steady at $1,150-1,200/tonne FOB SE Asia amid unchanged supply and demand fundamentals. Indonesia-origin cargoes were mostly heard available at $1,180-1,190/tonne FOB while those of Malaysian-origin were heard at $1,220-1,230/tonne FOB. Bids remained lower at $1,140-1,150/tonne FOB SE Asia.
Likewise, the prices of C18 stearic acid triple pressed (TPSA) are flat at $1,150-1,200/tonne FOB SE Asia, reflecting discussions heard. An Indonesian seller was heard offering cargoes at $1,130-1,150/tonne FOB but most sellers said cargoes at this price were not reflective of the broader market in general.
Prices of TPSA in the Chinese market remained steady at CNY9,400-9,500/tonne EXW despite a drop in buying interest.
Meanwhile, the firming demand for C18 stearic acid rubber grade (RGSA) exerted upward pricing pressure this week. Prices are assessed as up by $20/tonne at the low end of the range at $1,120-1,150/tonne FOB SE Asia. Firm bids and offers were heard at this price range.
Demand in the C18 oleic acid market is tapering off as buyers have little requirements for C18 oleic acid. Most buyers were heard to be well covered as most made bulk purchases earlier. Prices are down by $50/tonne at $1,500-1,550/tonne FOB SE Asia, reflecting discussions heard.
Feedstock prices
The Bursa Malaysia crude palm oil (CPO) August delivery contract was traded at Malaysian ringgit (M$) 3,117/tonne ($1,048/tonne), unchanged from the previous week.
Indonesian CPO August delivery contracts rose by $10/tonne to $1,078/tonne FOB Indonesia this week. Refined, bleached and deodorised (RBD) palm stearin August contract prices are down by $15/tonne at $940/tonne FOB Malaysia.
Refined, bleached and deodorised (RBD) palm olein August prices rose by $10/tonne to $1,180/tonne FOB Malaysia. Crude palm kernel oil (CPKO) prices are up by $9/tonne at $1,369/tonne FOB Malaysia this week.
Freight rates
From southeast Asia to northeast Asia: approximately $10-30/tonne
From southeast Asia to Japan: approximately $10-50/tonne
($1= M$2.97)
($1= CNY6.43)
This week in ICIS News( www.icis.com)
02/08/2011 12:26Asia crude palm oil prices mixed at close of trade
02/08/2011 05:34Malaysia August crude palm oil at M$3,117/tonne on Monday
01/08/2011 13:00Stephenson Group signs sustainable palm oil agreement with New Britain Oils
01/08/2011 01:00Oleochemicals: Fatty alcohol price down on weak demand, lower feedstock cost
01/08/2011 01:00Oleochemicals: Asian fatty acid subdued
