– Production disruption at FCFC likely to persist
– June trades twice at $1,052/mt CFR Taiwan/China
Asian PX prices edged $3/mt higher on Wednesday at $1,055/mt CFR Taiwan/China and $1,036/mt FOB Korea, with market discussions rangebound amid quiet market. The impact from the unplanned outage at Taiwan’s Formosa Chemicals and Fibre Corp. No. 3 aromatics plant remains unclear, following a fire that lead to a shutdown on Sunday. Some market participants were of the view that the plant would likely be shut for at least a month to conduct repairs, leading to an estimated production loss of 74,000 mt. A prolonged shutdown of the plant may lead to a tighter May PX market, resulting in a dearth of May delivery offers on the market, as sellers held back to observe the market. The May/June backwardation was assessed at $9/mt Wednesday, unchanged on the day as June delivery cargoes continue to come under heavy pressure from the start-up of Hengli Refining and Chemical Co.’s PX unit in northeastern Dalian, which should lead to a continued widening of the May/June backwardation, traders said. During the Wednesday Market on Close assessment process Wednesday, an outstanding Asian-origin May bid from Hengli at $1,061/mt remained at the end, with no market participant expressing any interest, while an outstanding June offer from Oman Trading International at $1,058/mt also failed to attract any buying interest. There were two trades concluded on the MOC, both for June delivery at $1,052/mt CFR Taiwan/China.
Asian PX prices were assessed up $3/mt day on day at $1,055/mt CFR Taiwan/China and $1,036/mt FOB Korea Wednesday. The markers take an average of the H2 May and H1 and H2 June laycans. The H2 May laycan was assessed at $1,061/mt, above an outstanding open origin May bid from GS Caltex at $1,060/mt. The June laycans were assessed at $1,052/mt CFR Taiwan/China, at the level of the last June trade between BP Singapore and Mercuria, and above an outstanding Asian origin June bid by GS Caltex at $1,051/mt, which was normalized due to a restriction in origin. The June laycans were also assessed at a $9/mt backwardation to the H2 May laycan, unchanged on the day. The above rationale applies to the following market data codes: “PHASS05” for FOB Korea and “AAQNE00” for CFR Taiwan/China.