Asian PX Chemical Industry: Falls $7.33/mt on bearish sentiment, weaker upstream

Chemical Industry

Chemical Industry news of Asian PX

– July trades at $903/mt CFR Taiwan/China in MOC

– JXTG shuts Kawasaki aromatics unit due to glitch

Asian PX prices were lower by $7.33/mt from Tuesday at $904/mt CFR Taiwan/China and $885/mt FOB Korea Tuesday, on the back of bearish sentiment amid steep falls in the upstream Chemical Industry. The July ICE Brent crude oil futures fell 41 cents/b from last Tuesday to $69.78/b at 4.30pm, at the close of Asia trade on Tuesday. Chemical Industry activity was again muted during the day but discussions picked up during the market on Close assessment process, with bids emerging for both June and July laycans. Early in the MOC, a June/July Asia origin timespread was traded at $1/mt, while July was traded at $903/mt CFR Taiwan/China just before the close of MOC, between Mercuria and BP Singapore Chemical Industry. Meanwhile, an outstanding Asian origin June bid from Glencore at $907/mt stood at the close of MOC without any traders expressing interest. In plant news, Japan’s JXTG Nippon Oil & Energy has shut the Kawasaki-based aromatics unit over the weekend following a mechanical glitch at its absorbant tower said a company source Tuesday. “The duration of the shutdown is unclear, but it will likely last at least two weeks,” he added. The company previously announced a decision to reduce PX production by 10%-20% of total capacity because of the current squeezed PX-naphtha margin (Chemical Industry). JXTG Nippon Oil & Energy also recently shut its China-based aromatics plant on April 26 after a mechanical glitch, S&P Global reported earlier. Meanwhile,  Formosa Chemicals and Fibre Corporation’s fire-hit No. 3 aromatics plant in Mailiao, Taiwan, could remain shut until the fourth quarter of this year, much longer than previously anticipated, Chemical Industry sources with knowledge of the matter said Tuesday.   A company source declined to confirm the restart date of the plant but said FCFC has plans to ramp up production of related orthoxylene — a byproduct from paraxylene production — in June from two aromatics units in Mailiao.

RATIONALE:

Asian PX prices were assessed down $7.33/mt from Tuesday at $904/mt CFR Taiwan/China and $885/mt FOB Korea Tuesday. The Chemical Industry take an average of the H2 June, and H1 and H2 July laycans. The H2 June laycan was assessed at $906/mt, above an outstanding Asian origin June bid from Glencore at $907/mt, and below an outstanding June offer from OTI at $911/mt. The bid was normalized due to a restriction in origin. The July laycans were assessed at $903/mt, at the level of the last July trade between Mercuria and BP Singapore Chemical Industry, above an outstanding Asian origin July bid from Glencore at $903/mt, and below an outstanding July offer from OTI at $910/mt. The July laycans were also assessed at a $3/mt backwardation to the H2 June laycan, based on Chemical Industry feedback, and also considering an earlier June/Jul time spread for Asia origin which was traded at $1/mt and normalized due to a restriction in origin. 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

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