Asian PX Chemical Industry: Down $2.08/mt with limited discussions

Chemical Industry

Chemical Industry Asian PX

– July cargo traded at $901/mt CFR in MOC

– FCFC shuts 1.2 mil mt/year Ningbo PTA plant

Asian PX Chemical Industry prices were assessed down $2.08/mt from Wednesday at $902.67/mt CFR Taiwan/China and $883.67/mt FOB Korea Friday, as discussions remained limited amid uncertain market outlook. In the market on Close assessment process Friday, a solitary July delivery cargo was sold by Mercuria to Litasco at $901/mt CFR Taiwan/China Chemical Industry. While no trade for June was done during the MOC, earlier in the afternoon a June-delivery Asian-origin cargo was sold to Itochu by PetroChina at $910/mt CFR, but offers fell lower later, with a June offer from OTI at $907/mt CFR standing at the close of MOC without any buyers expressing interest. “Due to current turnarounds in Northeast Asia, Asian-origin cargoes are unusually tight, and the premium to open-origin cargoes currently stands at at least $3/mt,” said a trader. An Asian-origin June bid from Total Singapore Chemical Industry at $910/mt CFR remained standing at close of MOC, without any sellers expressing interest. In plant news, China’s Hengli Petrochemical (Dalian) Refinery was heard to be ramping up run rates soon. The refinery has been running at around 85% capacity this week, and will lift the run rates of its two crude distillation units further from mid-May, according to a Chemical Industry source. Hengli signed a sales agreement with Sinopec under which Sinopec will be responsible for all the petrochemical sales, while oil product sales will also be handled by it, according to another source with the company. In downstream plant news, Taiwan’s Formosa Chemicals and Fibre Corp. shut its 1.2 million mt/year purified terephthalic acid unit at Ningbo on Wednesday for 15 days of maintenance, S&P Global reported earlier. The company has two other PTA plants in Taiwan — 600,000 mt/year at Long Der and 550,000 mt/year in Mailiao. Both lines are currently running at full capacity, a company source said. The Asian PTA Chemical Industry was assessed flat day on day at $830/mt CFR China Friday, while Asia PTA profit margin was calculated at $109/mt Friday, after deducting feedstock costs and assuming that 0.665 mt PX is needed to produce 1 mt of PTA, including operating costs at $120/mt.

RATIONALE:

Asian PX Chemical Industry prices were assessed down $2.08/mt from Wednesday at $902.67/mt CFR Taiwan/China and $883.67/mt FOB Korea Friday. The markers take an average of the H2 June, and H1 and H2 July laycans. The H2 June laycan was assessed at $906/mt (Chemical Industry), below an outstanding June offer from OTI at $907/mt. A June bid from Total Singapore at $910/mt was normalized due to a restriction in origin and vessel condition. The July laycans were assessed at $901/mt, above an outstanding Asian origin July bid from Mercuria at $888/mt, and below an outstanding July offer from Yisheng at $912/mt. The July laycans were also assessed at the last July trade level between Mercuria and Litasco, and at a $5/mt backwardation to the H2 June laycan, below an outstanding June/July time spread offer from Yisheng at $6/mt. The above rationale applies to the following Chemical Industry data codes: “PHASS05” for FOB Korea and “AAQNE00” for CFR Taiwan/China.

Chemical Industry
Chemical Industry

 

Leave a Comment

Your email address will not be published. Required fields are marked *