Market Brief
European butyl acetate (butac) is balanced-to-long amid good supply and slowing demand, as Europe slips further into the summer holiday season.
Prices
A slightly lower range of prices are reported for butac this week on the back of the good supply and slower demand.
Prices have been assessed at 1,270-1,310/tonne FD NWE with a drop of 10/tonne to reflect the change in demand.
Prices on either side of the above published ranges, however, are heard in the market. A producer with limited availability to the spot market said it is still selling well above the current range at 1,320-1,350/tonne, as it sees no weakening in demand.
Another producer that has witnessed good, albeit slower, demand during the week said it is selling within the above range, with sales mainly concentrated at 1,280-1,290/tonne.
Meanwhile, a distributor said it completed deals at 1,250/tonne-1,280/tonne this week, adding that prices are under downward pressure, possibly because of surplus product in the butac market.
However, deals below 1,270/tonne are still rare among the industry sources spoken to this week.
In other regions, prices for butac are heard around $1,450/tonne (1,015/tonne) FOB Turkey.
Upstream News
The European propylene contract settled at 1,115/tonne FD NWE for August, down by 15/tonne from July. This was the second number to emerge after an initial rollover settlement failed to find the necessary support from the market. While feedstock is firm, the bearish supply-and-demand balance continues to weigh on spot levels, but sources say these are showing signs of stabilising around 900/tonne CIF NWE.
The European acetic acid market remained balanced to long, most sources said this week. Contract negotiations for the third quarter had hardly started after the late settlements from the second quarter, players said. Prices were expected to come down, however, as both sellers and buyers agreed that the market has been overpriced in recent months.
High captive consumption and production outages at several European manufacturing sites have sustained butanol prices this week despite softer upstream propylene values, which settled at 1,115/tonne FD NWE for August, down by 15/tonne from July. Prices remain stable at 1,270-1,320/tonne FD NWE for both n-butanol (NBA). According to one supplier, some business has been done below 1,270/tonne. However, most prices remain at the above-published range. One producer said robust demand has increased prices of isobutanol (IBA) by 10/tonne to 1,280-1,330/tonne FD NWE. Pending further confirmation, prices remain unchanged at the above-published range.
($1 = 0.70)
Covering Editor: Cuckoo James
This week on ICIS ( www.icis.com )
29 Jul 11 14:30 Europe August propylene fully settles after second number emerges
29 Jul 11 13:00 NOON SNAPSHOT - Europe Markets Summary
28 Jul 11 15:41 INSIGHT: Default lies not in our stars but in ourselves
