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Update on Celanese’s Acetyl Intermediates Price Increase

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Celanese announces price hikes

On February 21, 2018, Celanese (CE) announced another round of price increases for several of its acetyl intermediates products. The latest price increase will be effective immediately or as its contracts allow for a variety of products in several regions.

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Celanese products subject to price hikes

  • The price of acetic acid increased by 300 yuan per metric ton in China, $50 per metric ton in Asia outside China, 50 euros per metric ton in Europe, $0.02 per pound in the US and Canada, and $50 per metric ton in Mexico and South America.
  • The price of acetic anhydride was increased by 400 yuan per metric ton in China.
  • The price of butyl acetate and ethyl acetate prices was increased by $50 per metric ton in Asia outside China.
  • The price of vinyl acetate monomer prices was increased by 50 euros per metric ton in Europe.

These price increases could be positive for Celanese’s revenues, as previous price hikes had a positive impact on the company. In 4Q17, its Acetyl Chain segment reported revenues of $888.0 million, an increase of 18.5% on a year-over-year basis. 

This growth was primarily driven by the price increase. This is the third time in 2018 that CE has increased prices of its acetyl products. The impact of these price hikes would be visible in CE’s 1Q18 earnings.

Celanese’s stock price update

Celanese (CE) stock gained 1.7% and closed at $103.95 for the week ended February 23, 2018. Despite the strong gain in the stock price, CE still traded 2.3% below the 100-day moving average price of $106.38, indicating the prevailing weakness in the stock. 

On a year-to-date basis, CE has fallen 2.9%. Among its peers Westlake Chemical (WLK), Eastman Chemical (EMN), and LyondellBasell (LYB) have gained 4.4%, 11.7%, and 1.2%, respectively.

Investors can indirectly hold Celanese by investing in the First Trust Materials AlphaDEX ETF (FXZ), which gained 0.70% for the week. FXZ invested 1.9% of its portfolio in Celanese on February 23, 2018.

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