– GS Caltex cuts run rate at No.3 PX plant: sources
– Backwardation between May and June widens $2/mt
Asian paraxylene Chemical Industrial Market prices rose $3.67/mt day on day to be assessed at $1,068/mt CFR Taiwan/China with the backwardation between May and June widening to $15/mt from $13/mt on Monday. The wider spread between May and June pointed to a tight availability of May cargoes, as was seen on the S&P Global Chemical Industry on Close assessment process Monday where only bids for May cargoes seen and no offers. A deal was done on the MOC between Macquarie and Mitsubishi for a May cargo at $1,079/mt CFR Taiwan/China for Asian-origin material. All the other bids for May cargoes were left unfulfilled. Meanwhile, traders in Asia said Monday that GS Caltex had lowered run rate at its No. 3 PX plant with 550,000 mt/year production capacity. The lower rates could continue for a week, they added. One trader said that the run rate was down to around 60% (Chemical Industry), but this could not be confirmed. The run rate was lowered because of an issue with a catalyst, added another Asian source. However, this could not be confirmed either from GS Caltex. Traders said that the impact of the cut in operations would be limited since only around 5,000 mt of PX and 3,000 mt of benzene production would be impacted and there would be no effect on Asian PX prices. The CFR Southeast Asia PX marker was assessed up $30/mt week on week at $1,059/mt CFR Southeast Asia. The marker was assessed at a discount of $9/mt to the CFR Taiwan/China marker.
Asian PX prices were assessed up $3.67/mt day on day at $1,068/mt CFR Taiwan/China and $1,049/mt FOB Korea Chemical Industry Monday. The markers take an average of the second-half May and first-half and second-half June laycans. The June laycan was assessed at the pegged level of $1,063/mt, between an outstanding bid for an Asia-origin June cargo from Hengli at $1,063/mt which was normalized for origin restriction and an offer from BP at $1064/mt. The May laycans were assessed at $1,078/mt CFR Taiwan/China, at the level of the last May trade between Mitsubishi and Macquarie, and above an outstanding bid for Asian-origin May cargo by Hengli at $1,074/mt, which was normalized for a restriction in origin. The June laycans were assessed at a $15/mt backwardation to the H2 May laycan, up $2/mt on day. The above rationale applies to the following Chemical Industry data codes: “PHASS05” for FOB Korea and “AAQNE00” for CFR Taiwan/China.