(ICIS) -- A Europe-based producer of monoethylene glycol (MEG) is targeting an increase of ┬70/tonne ($92/tonne) in the January contract price, up from December's ┬975/tonne, because of rising feedstock costs and tight supply, a source with the producer said on Thursday.
⌠Ethylene needs to jump, and I also see MEG increasing into the mid-┬1,000/tonne, so a further significant increase of ┬70/tonne. Product is tight, the source said.
Upstream ethylene in Europe was finely balanced. Price ideas for January centred on an increase of ┬80-100/tonne, based on firm crude and naphtha values, as well as robust demand. The December ethylene price settled at ┬1,005/tonne FD (free delivered) NWE (northwest Europe).
The MEG market has also been finely balanced. As a net importer, Europe has been reliant on imports during a time of rising prices in other regions.
Customers remained unhappy about the ┬70/tonne hike implemented from November to December, and they were against seeing further increases in January. They cited decreases in the Asian contract price nominations as a reason to curb calls for an increase in Europe.