Asian PX: Falls $23.84/mt as buyers stay away

– Sentiment bearish ahead of May ACP negotiations

– September PTA futures fall Yuan 50/mt on day

Asian paraxylene prices were assessed down $23.84/mt from Friday at $947.83/mt CFR Taiwan/China and $928.83/mt FOB Korea Friday. “Apart from a handful of traders looking to cover their June shorts, there was a distinct lack of buyers in the market,” a trader said. Bids for June-delivery cargoes were heard at $940/mt CFR Taiwan/China before the close of the Asian trading day Friday, but due to the wide gap between buying and selling indications, no trades were confirmed done. During the S&P Global Market on Close assessment process Friday, no bids were seen against sharply falling offers for both June and July cargoes. An offer for a June-delivery cargo from Oman Trading International was seen at $951/mt CFR Taiwan/China, but it failed to attract any buying interest and was withdrawn. Similarly, for July delivery, an offer from Mercuria was seen at $946/mt CFR Taiwan/China and was withdrawn shortly before the close of the MOC as it failed to attract buying interest. The June/July backwardation was assessed at $2.75/mt Friday, below an outstanding June/July time spread offer from Glencore at $3/mt, which stood at the close of the MOC. Downstream, the most actively traded September purified terephthalic acid futures contract on the Zhengzhou Commodity Exchange in China continued to fall Friday, dropping Yuan 50/mt to Yuan 6,022/mt at the close of afternoon trade. Meanwhile, nominations for the May PX Asian Contract Price have mostly been confirmed Friday. South Korean refiner S-Oil nominated the May ACP for PX at $1,100/mt CFR Asia. Earlier, India’s Reliance Industries, Japan’s JXTG Nippon Oil & Energy and US major ExxonMobil had all nominated their May PX ACP offers. The offers for the May ACP ranged between $1,100-$1,140/mt CFR Asia. Market sources close to the negotiations were pessimistic about negotiations for the May ACP reaching a major settlement due to the wide gap between initial offers and the PX spot price in Asia, which has come under huge selling pressure. Elsewhere, the European April PX contract price has fully settled at Eur995/mt (about $1,116/mt), a rollover from March, sources said Friday. The spot 5-30 days forward European PX price was assessed on Friday at $840/mt FOB ARA. The European spot PX market has been oversupplied since March, with traders reporting thin trading and bearish demand from Asia due to downstream PTA plant maintenance in China, and supply length due to the start up of Hengli Refining and Petrochemical’s 2.25 million mt/year PX plant in Dalian. In data, Thailand’s PX exports fell 30.2% month on month to 58,586 mt in March, the latest customs data released showed.

RATIONALE:

Asian PX prices were assessed down $23.84/mt from Friday at $947.83/mt CFR Taiwan/China and $928.83/mt FOB Korea Friday. The markers take an average of the H1 and H2 June, and H1 July laycans. The June laycans were assessed at $948.75/mt, below an outstanding June offer from Litasco at $969/mt, and considering an earlier offer from Oman Trading International at $951/mt, which was withdrawn shortly before the close of the MOC. The H1 July laycan was assessed at $946/mt, at a $2.75/mt backwardation to the June laycans, based on an outstanding June/July time spread offer from Glencore at $3/mt, and considering a withdrawn offer from Mercuria at $946/mt shortly before the close of the MOC. The above rationale applies to the following market data codes: “PHASS05” for FOB Korea and “AAQNE00” for CFR Taiwan/China.

 

Chemical Industry
Chemical Industry

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