The Urethane Blog

Falling Crude

http://quotes.ino.com/chart/index.html?s=NYMEX_CL.N12.E&t=&a=&w=&v=dmax

Spandex Market Update

Will Spandex Market Rebound?

2012-05-24 [Source: Pudaily]

PUdaily, Shanghai-Currently, spandex capacity increases 30% and meanwhile, the overall global textile consumptions are not high due to European and American debts crisis. Therefore, the relationship between the supply and demands is unbalanced. Market players in spandex field are pessimistic with the market.

In late April, the spandex prices rebound slightly and some players predict that the spandex market will break the depressing situation. Currently, how to change the situation is paid more attentions.

Seen from the costs, though BDO prices continue sliding down, the restricted supports are disappearing. Meanwhile, some manufacturers have turnaround plans and some foreign facilities operate unstable, thus the stocks are tight. Besides, pure MDI stocks are also tight due to the maintenance. Therefore, the prices are trending upwards.

As to terminal demands, along with the coming of the slack season of textile, some factories begin to reduce or stop productions. Some buyers are intended to stock up as spandex prices are going upwards.

To the supply, the spandex prices are hiked by RMB 1000-2000/ton and this changes the sluggish situation that remains for a long time. What's more, some manufacturers are stimulated to expand capacity. It is known that the overall operation rates of the spandex industry are raised at 85%.

http://www.pu366.com/News_View.asp?NewsID=31239&KindDetailID=2

Propylene Chart Update

This includes the ten cent drop in May:

 

 

European Market Update

Europe polyol contract prices largely rollover in May

ICIS News : 9-May-12 23:59

 

LONDON (ICIS)--European polyol contract prices have largely rolled over into May, as lower upstream costs are weighed against margin recovery and balanced market conditions, market players said on Wednesday.

However, there were some selective increases of €30-50/tonne ($39-65/tonne) for slabstock conventional polyols reported in May, depending on starting point.

Polyol producers had expressed the need to raise polyol prices in May, in view of the previous feedstock increases, which were yet to be recovered. However, price increases had proved difficult to justify in May in most cases in view of the upstream cost relief and balanced market conditions.

Buyers had also faced price increases for polyols, and its flexible counterpart toluene di-isocyanate, successively since the start of the year and had been struggling to pass this on downstream.

While there was a general stable pricing trend for slabstock conventional polylols in May, in terms of actual numbers, prices were reported in a narrower range of €1,850-1,950/tonne FD (free delivered) NWE (northwest Europe), according to ICIS. This represented a rollover at the low-end of the range and a reduction of €30/tonne at the upper part of the range.

Players added that prices in excess of the mid €1,900s/tonne FD were typically for high resilience or other speciality grades rather than slabstock conventional polyols.

According to some buyers, flexible polyol demand into the bedding and furniture sectors is slowing, earlier than is normally seasonally the case. They attributed this slowdown to general economic concerns limiting consumer spending. Polyol producers, however, described demand as fairly steady, with little to no evidence of any seasonal slowdown.

The flexible polyol market is largely balanced, although some buyers suggest that it is balanced-to-long, on the back of slowing demand.

For rigid polyols, prices are largely steady in May because of a number of quarterly contracts, where prices are fixed for the rest of the quarter following increases seen in April. For monthly business, there were a mix of settlements, ranging from rollovers, reductions of €50/tonne and increases of €20/tonne, depending on starting point. Despite this, prices were largely confirmed unchanged in the €2,000s/tonne FD.

Rigid demand into the downstream construction sector is relatively flat because of some underlying economic uncertainty, although there is some regional variation. Germany, Austria and Switzerland are holding up reasonably well. However, the UK and southern Europe are performing less well as they are seen to be more affected by economic constraints. By contrast, one producer said that demand is good, and in line with seasonality. The rigid polyol market is fairly balanced as flat demand is offset by a limited supply base.

In related news, Dow Chemical has completed maintenance on its rigid polyol train in northwest Europe, which took place during April. The same unit will also undergo similar maintenance work in June for a few weeks.

($1 = €0.77)

http://www.icis.com/Borealis/Article.asp?p=1&q=BCBDCEDDCABDDCC7D0DFC099AFCFD185B8E7BBC6DF6DDCBDCEDDC6B7DCB8D48DBCDF6ECADBD9AEE5B8D4E1&id=B28396A5957DA9

Propylene Update

US propylene contracts for May could drop 7-12 cents/lb: sources

Houston (Platts)--7May2012/501 pm EDT/2101 GMT

US propylene contracts for May could drop anywhere from 7-12 cents/lb given falling spot prices that have resulted from continued lackluster demand from key downstream markets, market sources said Monday.

US spot polymer-grade propylene was heard done at 63 cents/lb MtB pipe in morning trading after being talked in a range of 60-65 cents/lb. The last time spot PGP was talked this low was in mid-January, when Platts assessments were at 61.75 cents/lb for the week ended January 20.

"Spot PGP at 63 cents/lb implies a contract price of around 65.50 cents/lb," a source with a major buyer said.

Propylene sellers strongly disagreed, with one source with a major producer saying prices down 7 or 8 cents/lb was more reasonable.

"You know that no producer would be selling down while negotiating a contract price," the source said of the 63 cent/lb deal.

Some sources, including at least one producer, pointed to refinery-grade propylene hanging steady around 60 cents/lb MtB pipe and alkylation values in the low-to-mid 60s cents/lb as reasons why propylene contracts likely won't drop as much as some believe.

The propylene market follows spot RGP prices since the grade is often used to make higher-purity propylene such as PGP. The alkylation value of RGP is its implied value as a component of the gasoline pool.

The propylene market closed last week talking an expected decrease of between 5-10 cents/lb. Talk of a more pronounced decrease rose Monday after an industry consultancy pegged the downward movement at 12 cents/lb for May.

Contracts last settled for April at 77.50 cents/lb for polymer-grade propylene, and at 76 cents/lb for chemical-grade propylene.

A 12 cents/lb decrease would put May PGP at 65.50 cents/lb, in line with recent spot levels, sources said.

"PGP is around 63 [cents/lb] and contract down 12 yields a 65.5 cents/lb price," a veteran olefins trader said. "So spot is where it should be."

Initial nominations from major producers were heard at flat for PGP and at down 3 cents/lb for CGP, although privately at least some sellers were considering bigger drops, two market sources said last week.

Expectations of an even more pronounced decrease were heard in the polypropylene market, where spot homo polymer injection was heard talked some 15 cents/lb or more lower than contract levels for April at 86-87 cents/lb.

US propylene contracts are settled on a monthly basis between major producers and buyers. The process includes price nominations by producers and subsequent negotiations with customers.

Spot PGP was last assessed Friday at 64-64.50 cents/lb delivered, with CGP at 61-61.50 cents/lb and RGP at 58.75-59.25 cents/lb, also delivered.

 

http://www.platts.com/RSSFeedDetailedNews/RSSFeed/Petrochemicals/6272553

 

European Propylene Falls in May

This drop equates to around 9c/lb:

 

UpdateEurope May propylene confirmed down €15/t at €1,230/tonne

27 April 2012 14:10  [Source: ICIS news]

LONDON (ICIS)--The European May propylene contract price has been fully confirmed at €1,230/tonne, down by €15/tonne ($20) from the previous month, two main producers and two consumers said on Friday.

An initial settlement was reached between one major producer and one pure consumer earlier on Friday. After some buyer reluctance, one net consumer later confirmed the reduction with a second main manufacturer. A third producer also agreed this with the first settling consumer.

The initial settling seller said that cost recovery at cracker level had been an ongoing issue, as cracker operators had been “chasing their tail” in passing on recent upstream naphtha increases.

It said that the reduction in the propylene contract weighed up the “need to sustain cracker margins, as well as to support downstream demand and margins.”

A decrease was widely expected by consumers on the back of feedstock relief and softer market conditions.

Some buyers, however, said they were not prepared to agree to the €15/tonne decrease, as they considered this insufficient in view of the softer trend in upstream naphtha costs in April, lengthier propylene supply and some demand uncertainty because of heightened economic concerns.

As a result, they said that decreases of €20–30/tonne, in some cases as a minimum, would have been more realistic.

Producers had been holding out for rollovers or a very minor price reduction. While naphtha was softer in April, they were mindful of the heightened upstream volatility and poor cracker margins over recent months.

The propylene May contract was agreed on a free delivered (FD) northwest Europe (NWE) basis.

http://www.icis.com/Articles/2012/04/27/9554574/europe-may-propylene-confirmed-down-15t-at-1230tonne.html

Benzene, Toluene Updates

 

Platts Petrochemical Analysis: Asian benzene prices rise on US, European price surge

Houston (Platts)--23Apr2012/820 am EDT/1220 GMT

 

 

Asian benzene rose $6/mt Monday from last Friday to $1,199/mt FOB Korea, shown in red below, as prices in the US and Europe surged. "Downstream markets for [Asian] benzene are really bad, but prices rose because Asian cargoes to the US were heard to be delayed," a South Korean trader said.

"European sellers were also heard to have cancelled their orders to the US, causing the rise in US benzene prices," the trader added. Front month ICE Brent crude futures fell $0.47/barrel day on day to $118.16/b at 4:30 pm Singapore time (0830 GMT) April 23.

Benzene activity in the Asian trading day was focused on June and July cargoes. A July cargo was transacted at $1,199/mt FOB Korea from Interchem to Raystar.

In other news, Japan's largest refiner, JX Nippon Oil & Energy, has settled its May Asia Contract Price for benzene at $1,220/mt CFR, up $30/mt or 2.5% from its April settlement of $1,190/mt CFR, a company source said April 23. "The ACP was raised as market prices are higher now," the source added.

In the US, benzene climbed to $1,267/mt FOB USG. European benzene climbed $8/mt Friday to $1,236/mt CIF ARA. (See chart 1)

The FOB Korea toluene marker was assessed at $1,214/mt April 23, up $3/mt from April 20 despite lower crude as downstream benzene rose. Discussions were thin April 23 but a July cargo was bid up in the morning while June was stable, suggesting a widening contango structure at the back end of the forward curve.

As a result, the June/July spread was assessed at $2/mt April 23, from $1/mt April 20. At latest prices, the FOB Korea-FOB US Gulf spread has narrowed further to $3.52/mt, from $6.52/mt April 20. The US toluene price was assessed April 19 at $1,216/mt FOB USG. (See chart 2)

http://www.platts.com/RSSFeedDetailedNews/RSSFeed/Petrochemicals/8208840

 

Propylene Rolls Over for April

In one of the latest settlements recently, propylene has finally rolled over for the month.  Buyers were pressuring for a decrease, and the market seems to anticipate one next month. 

 

 

Chemtura Price Increases

Chemtura Announces Urethanes Price Increase

 

 

PHILADELPHIA, Apr 02, 2012 (BUSINESS WIRE) -- Chemtura Corporation CHMT +2.28% has announced that it is raising the price of the products supplied by the Urethanes Business effective May 1, 2012, or as contracts allow, as the result of continued and significant escalation in the cost of key raw materials used in the manufacture of pre-polymers and specialty curatives. Chemtura will increase the prices of its pre-polymers and specialty curatives by up to 9 percent in North America, Latin America and Asia Pacific regions. These increases are essential to sustain Chemtura’s ability to provide high-quality products, service levels and innovative offerings.

 

http://www.marketwatch.com/story/chemtura-announces-urethanes-price-increase-2012-04-02

Propylene Inventories

http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WPLSTUS1&f=W