Asian acetic prices were stable, if not a little firmer this week, with a few turnarounds planned in March and April, and producers have started stockpiling inventory. “There’s not a big change on the buyer’s side as the market heads into the Lunar New Year holidays,” a trader said. Trade sources said downstream purified terephthalic acid production was stable till the Lunar New Year, and acetic acid suppliers were not in a hurry to dump prices. “Buyers buy what they need … Many are covered already for the holiday period,” a second trader said. “Inventory for downstream is not high as people prefer to keep inventory low and have more cash in hand for the festive season. But buying activity should pick up after the Lunar New Year,” he added. Meanwhile, China’s Jiangsu Sopo’s No. 1 acetic acid plant with a capacity of 250,000 mt/year was heard to have reduced its operating rate last weekend, according to market sources. A company source said it was unclear if the reduced operating rates were due to a technical issue at the plant or something else, and did not know when it would return to normal operating rates, which was 90% of its capacity. VAM: Stable acetic acid prices this week were a good sign for the vinyl acetate monomer market, trade sources said this week. However, sentiment across Asia remained largely bearish as business had slowed with the impending Lunar Year holidays, they added. A producer said that ethylene prices were rising and there were concerns around higher costs. He added that they will be informing their customers about higher prices for February shipments to Southeast Asia and South Asia. Other producers said higher ethylene prices would affect VAM producers which use ethylene as a feedstock. A selling idea for ethylene-based VAM for end-February and March deliveries for Southeast Asia was heard at $920-$950/mt CFR. The CFR Northeast
Asia VAM marker was assessed at $1,040/mt Friday, up $40/mt from Thursday, and up $85/mt on week, Data showed. Still, a trader said demand for VAM was not expected to move much before the Lunar New Year holidays, and that buyers have probably “stocked up by now”. RATIONALE: AA: The CFR Far East Asia marker was assessed $5/mt higher week on week at $445/mt CFR Friday, tracking firmer FOB China prices. Discussions were heard around $440-$450/mt this week. Southeast Asia AA was assessed $5/mt higher over the same period at $445/mt CFR, tracking firmer prices in Far East Asia and China. The FOB China price was up $9/mt at $399/mt, against selling indications heard at $400-$410/mt FOB. The CFR South Asia marker was assessed at $435/mt, tracking firmer market fundamentals across regions. VAM: CFR China was assessed at $930/mt Friday, stable from last Friday, amid thin trading. The CFR Southeast Asia and CFR South Asia prices were unchanged week on week at $895/mt and $830/mt, respectively, amid stable market fundamentals.