US monoethylene glycol prices appear poised to rise in September if buyers accept increases announced so far by at least two producers.
Indorama Ventures will increases its off-list US ethylene glycol prices in September, the company said in a letter to customers. The company will increase its MEG prices by 5 cents/lb, effective September 1. The company cited higher Asian spot MEG values as well as several unplanned global supply outages as drivers behind the increase.
Indorama also added pointed to rising raw material costs as well as limited production within the US as justification for the increase. The company will also increase diethylene glycol and triethylene glycol prices by 3 cents/lb, effective September 1.
Additionally, Shell Chemicals said in a letter to its customers that it will increase its September MEG prices by 4 cents/lb, effective September 1. The company will hike its DEG prices by 2 cents/lb. No other announcements were heard by the time of publication.
The announcements come on the heels of an 2 cents/lb August price increase that was successfully implemented. Still, sources in the market reported that despite recent tightness on the supply side and demand from the anti-freeze sector, demand overall is questionable.
"The demand outlook is not good," one participant said.
Additionally, supply in the US will likely improve if Indorama has, as several market sources said, lifted the force majeure at its 358,000 mt/year Lake Charles, Louisiana, facility, which was declared July 20 because of a mechanical issue. The company was not immediately available to confirm the status of the force majeure.
