Benzene Price in India

Benzene discussions moved lower Wednesday, extending falls from Wednesday.

– Domestic prices fall below CFR China

– Wide bid-offer gap in CFR China discussions

Benzene discussions moved lower Wednesday, extending falls from Wednesday, as persistent bearish sentiment across the styrenics chain encouraged sellers to emerge. The weak sentiment was largely driven by news of China’s Hengli refinery having achieved on-specification production of paraxylene. According to company documents shown to potential offtakers, Hengli’s marketing of methanol was to start as early as January, followed by benzene in March, with polyolefins, styrenics and olefins following through the rest of the year. While benzene had yet to be on-specification, sources with knowledge of the matter said it would be “soon.” With a capacity of 970,000 mt/year, the start-up of the plant would result in more supply of benzene in an already-long market. Trade sources also noted that Hengli had started sooner than the market had anticipated, and news that the plant would soon be commercially producing benzene had greatly affected domestic prices since the start of the week. East China prompt prices were assessed lower by Yuan 180/mt day on day at Yuan 4,500/mt, or $567.29/mt on an import parity basis, while April material was assessed lower by Yuan 180/mt over the same period at Yuan 4,520/mt ($584.94/mt). Prices on an import parity level for April material were lower than CFR China offers by $25.06/mt, with buyers of import material were on the sidelines amid the downtrend. The best bid for H2 April cargo was heard at $600/mt, against an offer at $610/mt CFR China. The wide bid-offer spread brought further negotiations to a standstill. In the FOB Korea market, falling domestic East China prices contributed to bearish sentiment, as sellers emerged on a FOB Korea basis, as opposed to on a CFR China basis.

RATIONALE:

FOB Korea benzene was assessed lower by $10.50/mt day on day at $597/mt Wednesday. The marker takes the average of the third, fourth and fifth half-month laycans, namely H2 April, H1 May, and H2 May. During the  Market on Close assessment process, no fully transparent bids and offers were seen. The H2 April laycan was assessed at the pegged level of $583/mt FOB Korea, below an offer last seen at $587/mt FOB Korea. The H1 and H2 May laycans were assessed at the pegged level of $604/mt FOB Korea, above a bid last seen at $590/mt. The CFR China marker was assessed lower by $13/mt day on day at $603.50/mt, with H2 April heard offered at $610/mt CFR China, while bid levels were below $600/mt. The East China marker was assessed lower by Yuan 180/mt day on day at Yuan 4,507/mt, or $573.18/mt on an import parity basis.

 

FOB Korea benzene prices plunged Tuesday

Chemical Industry

– Bearish sentiment amid growing supply

– US prices dip 3.50 cents/gal

FOB Korea benzene prices plunged Tuesday, largely driven by news of China’s Hengli refinery having achieved on-specification production of paraxylene. According to company documents shown to potential offtakers, Hengli’s marketing of methanol was to start as early as January, followed by benzene in March, with polyolefins, styrenics and olefins following through the rest of the year. While benzene had yet to be on-specification, sources with knowledge of the matter said it would be “soon.” With a capacity of 970,000 mt/year, the start-up of the plant would result in more supply of benzene in an already-long market. “Hengli has started sooner than [the market] had anticipated,” a trader said Tuesday, adding that the news that the plant would soon be commercially producing benzene had greatly affected domestic prices Tuesday. Prompt domestic East China benzene had fallen Yuan 70/mt, or down $10.20/mt on an import parity basis, to Yuan 4,680/mt ($589.49/mt), while April prices were assessed at Yuan 4,700/mt ($607.73/mt). Over in the FOB Korea market, news of Hengli refinery’s progress, together with weakness in the US market, resulted in an $18.50/mt plunge in prices. “How long more can the US prices maintain [at high levels],” a trader said, noting that with the onset of falling prices in the US market, the downtrend in FOB Korea was inevitable. March DDP USG benzene was assessed down 3.50 cents/gal from Thursday at 230 cents/gal Friday, while FOB USG paper was also down 3.50 cents/gal over the same period at 226.50 cents/gal, or $677.24/mt.

RATIONALE:

FOB Korea benzene was assessed down $18.50/mt from last Friday at $607.50/mt Tuesday. The marker currently takes the average of the third, fourth and fifth half-month laycans, H2 April, H1 May and H2 May. During the  Market on Close assessment process Tuesday, no fully transparent bids and offers were seen. The H2 April laycan was assessed at $593.50/mt FOB Korea, below an offer last seen at $600/mt FOB Korea. The H1 and H2 May laycans were assessed at $614.50/mt FOB Korea, between a bid and offer last seen at $614/mt and $615/mt FOB Korea. The CFR China marker was assessed down $8/mt on the day at $616.50/mt. A buying indication for May arrival cargo was heard at $615/mt CFR China. The East China marker was assessed down Yuan 70/mt on the day at Yuan 4,687/mt, or $595.57/mt on an import parity basis.

 

NWE Benzene – Prices rise, mirroring gains in crude

Chemical Industry

– 5-30 day price up $2/mt on the day

– Quiet market at the beginning of the week

S&P Global Platts assessed European benzene for delivery 5-30 days forward at $664/mt Monday, $2/mt higher on the day. Market activity remained subdued Monday, with one source saying that he did not “see anything going on at all.” “No deals, all very slow,” the source added. Fundamentals on the benzene market remained unchanged, with a second source saying that the shutdown of Dow’s Boehlen plant continued to support benzene prices. Additionally, the second source said that the strikes taking place at Galp’s Sines and Porto plants until the end of the month may also affect the benzene market over the next weeks by tightening supply, although it is “too early” to see an impact on the market already. Upstream, crude oil prices rose to $67.33/b at 1630 GMT Monday from $66.80/b Friday. Downstream, in the European styrene market spot prices shifted higher Monday amid increasing buy interest for prompt and forwards cargoes. S&P Global Platts assessed styrene for loading 5-30 days forward at $1,117.50/mt FOB ARA Monday, up $17.50/mt on the day. Prices rose as market participants sought to secure volumes ahead of plant maintenances in the second quarter. Trading activity shifted to prompt cargoes as a deal was heard at $1,110/mt for March delivery.

RATIONALE:

S&P Global Platts assessed benzene for delivery 5-30 days forward at $667/mt CIF ARA Monday, up $2/mt from Friday’s assessment. March was assessed down $1/mt on the day at $669/mt, below an outstanding offer of $670/mt on Friday close and within the most competitive bid-offer range of $665-$685/mt Monday. April was assessed up $5/mt on the day at $666/mt, within the most competitive bid-offer range of $665-$670/mt. May was assessed at $664/mt, up $5/mt on the day, based on a stable backwardation of $2/mt between April and May and within the most competitive bid-offer range of $655-$675/mt. June was up $5/mt on the day at $659/mt, based on a stable May-June backwardation of $5/mt and within the most competitive bid-offer range of $645-$670/mt. July was assessed flat to June. FOB was assessed at $667/mt, flat to CIF.

Asian PX: Rises $3.33/mt tracking uptick in PTA futures

– Shrugs off declines upstream

– Downstream PTA remains bulllish

Asian paraxylene rose $3.33/mt from last Tuesday to be assessed at $1,124.25/mt CFR Taiwan/China Tuesday on the back of firm purified terephthalic acid futures. PTA futures for May rose Yuan 22/mt over the same period to Yuan 6,612/mt on China’s Zhengzhou Commodity Exchange. PX prices moved in the opposite direction to upstream markets Tuesday, with crude oil futures lower on the day and naphtha shedding $9.88/mt to $534.63/mt CFR Japan. In related news, South Korea’s Hyundai Cosmo Petrochemical, a 50:50 joint venture between Hyundai Oilbank and Japan’s Cosmo Oil, has confirmed plans to shut its No. 2 aromatics plant at Daesan for 20-30 days’ maintenance in May, a source close to the company said Tuesday. The plant can produce 130,000 mt/year of benzene and 800,000 mt/year of PX. Hyundai Chemical will shut its 1 million mt/year condensate-based mixed xylenes plant at the same location for 30-35 days of maintenance over H2 April-May, the company source confirmed. This coincides with the turnaround at Hyundai Cosmo Petrochemical’s No. 2 aromatics plant, which receives feedstock isomer-MX from Hyundai Chemical. In downstream markets, South Korea’s Hanwha General Chemical plans to shut its 700,000 mt/year PTA plant at Daesan at the end of March for a 3-4 weeks’ planned maintenance, a company source said Tuesday. The company has two other PTA units at Ulsan with a capacities of 400,000 mt/year and 450,000 mt/year. Market sentiment remains bullish in the Asian PTA market amid firmness in PX, with the PTA CFR China marker assessed flat from last Tuesday at $860/mt Tuesday.

RATIONALE:

Asian PX rose $3.33/mt from Tuesday to be assessed at $1,124.25/mt CFR Taiwan/China and $1,105.25/mt FOB Korea Tuesday. The markers take an average of the H2 April and H1 and H2 May laycans. The H2 April laycan was assessed at $1,122.75/mt CFR Taiwan/China, below an outstanding offer from Oman Trading International at $1,123/mt. The May laycans were assessed at $1,125/mt, below an outstanding May offer from Yisheng at $1,125.50/mt, and reflecting the level of a trade for Asian origin cargo for May between Litasco and BPSG. Value was deemed proven based on the last offer at $1,125.50/mt and the last deal at $1,125/mt. The above rationale applies to the following market data codes: PHASS05 for FOB Korea and AAQNE00 for CFR Taiwan/China.

NWE Benzene – Market silence continues

– No new bid-offer ranges heard

– Some talk of transactions heard

A quiet week continued for European benzene on  Friday, with pricing for February and March unchanged from  Friday. The 5-30 day forward delivery assessment rose 50 cents to $615/mt, based on the existing contango between the two months. Activity in the benzene market has been minimal this week, mirroring a lack of volatility upstream for ICE crude Brent, and a lack of activity downstream in the styrene market. Steam cracker turnarounds are due to begin in the second quarter, suggesting benzene prices could recover as less new material hits the market. But this is balanced against the potential impact of turnarounds by styrene producers in Europe. A trader said  Friday that trading activity had occurred  Friday at $640/mt, but did not name the month. This was also heard after the 16:30 close of the  Market on Close assessment process. The talk comes ahead of the settlement window for the March European contract price for benzene, set to begin Friday.

RATIONALE:

S&P Global  assessed benzene for delivery 5-30 days forward at $615/mt CIF ARA  Friday, up 50 cents from  Friday. February was assessed stable at $607/mt, with no disproving indications. March was assessed stable at $616/mt, also with no disproving indications. April was assessed at $621/mt, with no disproving indications. May was assessed stable at $631/mt, with no disproving indications. June was assessed flat to May. FOB was assessed at $615/mt, flat to CIF.

 

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Asian Benzene – Rises $6/mt on day; E China’s domestic market rangebound

– FOB Korea activities focused on Apr

– India’s Dec exports fall 1.2% on month

Asian benzene rose $6/mt day on day to $616.33/mt FOB Korea and $630.50/mt CFR China  Friday. At 4:30 pm Singapore time (0830 GMT), ICE April Brent crude futures were up 73 cents/b from the previous day at $67.04/b. In the FOB Korea market, trade activities were seen for April and May loading cargoes, with most of the buying indications concentrated on April loading. Discussions were rangebound in the east China domestic market, and the marker was assessed higher by Yuan 45/mt at Yuan 5,015/mt ex-tank, or $630.54/mt on an import parity basis,  Friday. Downstream styrene was assessed higher by $6.50/mt day on day at $1,028/mt FOB Korea and $1,068/mt CFR China. This brings the styrene-benzene spread to around $438/mt based on the CFR China prices, down $17/mt on the week, and just slightly lower by $4/mt month on month. In related downstream market, Asian caprolactam prices rose $50/mt week on week to $1,700/mt CFR Far East Asia and $1,680/mt CFR Southeast Asia  Friday on restocking needs following the Lunar New Year. In trade statistics news, India’s benzene exports were reported at 141,806 mt in December 2018, 1.2% lower month on month, but higher by 36.6% from the year-ago month, latest data from India’s Ministry of Commerce and Industry showed.

RATIONALE:

FOB Korea benzene was assessed higher by $6/mt day on day at $616.33/mt FOB Korea  Friday. The marker currently take the average of the third, fourth and fifth half-month laycans, H2 March, H1 April and H2 April. The April laycans were assessed at $620/mt, above an outstanding bid from SKGC Singapore at $619/mt. The H2 March laycan was assessed at $609/mt, based on the pegged March/April spread that was unchanged day on day at minus $11/mt. The CFR China marker was assessed at $630.50/mt  Friday, up $6/mt day on day, tracking the rise in the east China domestic market. The East China marker was assessed at Yuan 5,015/mt, up Yuan 45/mt day on day, equating to $630.54/mt on an import parity basis.

Asian PX: CFR Taiwan/China gain $7.42/mt amid a rollover in backwardation

– April trades twice at $1,115/mt CFR

– April/May backwardation assessed at $4.75/mt

Asian paraxylene prices rose $7.42/mt from last Tuesday to be assessed at $1,113.42/mt CFR Taiwan/China, and up $7.75/mt at $1,094.42/mt FOB Korea Tuesday, amid a rollover of laycans in backwardation. Activity in the S&P Global   Market on Close assessment process has shifted firmly to April-delivery cargoes following March declaration, with two April cargoes traded in the MOC process Tuesday at $1,115/mt CFR Taiwan/China for both deals. Firm demand for April cargoes had maintained a backwardated structure between April and May laycans, with the April/May backwardation assessed at $4.75/mt at the close of Asian trade Tuesday. No trades were seen for May as sellers kept offers firm, while buyers were tentative in matching higher offers in the market, wary of increased Asian spot supply next month originating from Southeast Asia, with both Thailand’s PTTGC and Indonesia’s TPPI offering additional spot PX for March loading.

RATIONALE:

Asian PX prices rose $7.42/mt from Tuesday, assessed at $1,113.42/mt CFR Taiwan/China and up $7.75/mt at $1,094.42/mt FOB Korea Tuesday, amid a rollover of laycans. The markers take an average of the H1 and H2 April and H1 May laycans. The April laycans were assessed at $1,115/mt CFR Taiwan/China, below an outstanding April offer from Oman Trading International at $1,119/mt, and considering the level of the last April trade between GS Caltex and Mercuria. The H1 May laycan was assessed at $1,110.25/mt, above an outstanding May bid from GS Caltex at $1,110/mt, and below an outstanding offer from BPSG at $1,115/mt. The H1 May laycan was also assessed at a $4.75/mt backwardation to the April laycans, considering an outstanding Apr/May Asian-origin timespread bid from Mercuria at $5.50/mt. The above rationale applies to the following market data codes: “”PHASS05″” for FOB Korea and “”AAQNE00″” for CFR Taiwan/China.

Asian Styrene: Rises $11.50/mt on stronger energy complex

– East China domestic prices fall

– Feedstock benzene, ethylene higher

Asian styrene monomer rose $11.50/mt from Tuesday to $1,062.50/mt CFR China and $1,022.50/mt FOB Korea Tuesday, tracking the rise in upstream crude oil futures, as well as higher feedstock benzene and ethylene prices. The spread between CFR China prices and import parity levels in the east China market has widened, in part reflecting diverging fundamentals between China and the rest of Asia, market sources said. While China is facing a continuous stock build, turnaround season in other Asian countries have tightened supply. Bids in the CFR China market were heard at $1,060-$1,065/mt for April cargoes while offers were heard at $1,070/mt for March cargoes. No deals were heard concluded. In the east China domestic market, the March marker was assessed lower by Yuan 30/mt from Tuesday at Yuan 8,330/mt ex-tank, with its import parity at $1,041/mt Tuesday. At 4:30 pm Singapore time (0830 GMT), ICE April Brent crude futures were at $66.78/b, up $1.95/b from Tuesday. In the feedstock markets, benzene rose $2.50/mt from Tuesday to $614.50/mt CFR China, while ethylene increased by $5/mt to $1,200/mt CFR Northeast Asia Tuesday.

RATIONALE:

Asian SM was assessed higher by $11.50/mt from Tuesday at $1,062.50/mt CFR China and $1,022.50/mt FOB Korea Tuesday. The CFR China and FOB Korea SM markers currently take the average of the H2 March and H1 April laycans. There were no transparent bids and offers during the   Market on Close assessment process. H1 April was assessed at the pegged level of $1,066/mt CFR China, above the best bid heard at $1,065/mt with no offer heard. Maintaining the pegged March/April spread of minus $7/mt, H2 March was assessed at $1,059/mt CFR China. East China domestic March marker was assessed at Yuan 8,330/mt ex-tank, down Yuan 30/mt from Tuesday. On an import parity basis, this is approximately $1,041/mt. The FOB Korea marker was assessed at $1,022.50/mt Tuesday, based on the pegged $40/mt spread to CFR China, while the CFR Taiwan marker was assessed at $1,050.50/mt, based on the pegged $12/mt spread to CFR China.

Prices rise tracking increases in Asia

– March traded at $1005/mt

– Asian markers up $3/mt on the day

European spot prices rose tracking earlier increases in Asia. S&P Global CSG assessed styrene for loading 5-30 days forward at $994/mt FOB ARA Wednesday, up $1.50/mt on the day. Buying interest continued on Wednesday as March cargoes were heard traded at $1,005/mt. “It seems [the market] is starting to pick up, especially the forward months which we can see from the prices,” a distributor said. Demand has picked up this month on expectations of turnarounds in the second quarter. Market participants were said to be waiting for movement in Asia, particularly China. High stocks in China were limiting shipments from Europe, sources said. Chinese inventory levels were last heard at 306,500 mt on Wednesday. The distributor added that European prices will be driven by Chinese supply and demand. Early discussions of the March contract price settlement were heard, and a source expected a small increase following an uptick in the spot market. “Considering benzene and ethylene costs, spot prices and buying activity, I expect a Eur20-25/mt increase,” the distributor said. In Asia, styrene rose $3/mt day on day to $1,077/mt CFR China and $1,027/mt FOB Korea Wednesday.

RATIONALE:

S&P Global CSG assessed styrene for loading 5-30 days forward at $994/mt FOB ARA Wednesday, up $1.50/mt on the day. February was assessed at $981/mt, up $5/mt on the day, $1 above the bid heard at $980/mt with the offer at $990/mt. March was assessed at $1,005/mt, down $4/mt in line with two trades heard at $1,005/mt and also within a bid offer range of $1,000-1,010/mt.

Rises $4/mt in line with PX

Asian isomer-grade mixed xylene rose $4/mt from last Tuesday to $671/mt FOBKorea and $688/mt CFR Taiwan Tuesday tracking firmness both up and downstream. Asian paraxylene rose $4/mt over the same period to $1,105/mt CFR Taiwan/China, while April ICE Brent crude oil futures rose 45 cents/b to $61.93/b at 0830 GMT. The MX market was largely quiet Tuesday until bids for March FOB Korea cargoes were heard during the CSG Market on Close assessment process. No offers were heard to counter. As the Chinese market returned from last week’s holidays, the East China ex-tank price of isomer-MX was heard around Yuan 5,350-5,450/mt, equating to $663.70/mt on an import parity basis, according to a trade source in East China.

RATIONALE:

Isomer-MX was assessed up $4/mt from last Tuesday to $671/mt FOB Korea and $688/mt CFR Taiwan Tuesday. The markers take the average of the third and fourth half-month laycans, currently H1 March and H2 March. No bids or offers were registered during the CSG Market on Close assessment process. During the MOC process, March loading cargo was heard bid at $671/mt FOB Korea. Both H1 and H2 March laycans were assessed at $672/mt FOB Korea, above the bid. No bids or offers were heard during the MOC process on a CFR Taiwan basis. The CFR Taiwan price was assessed $4/mt higher tracking the FOB Korea marker and rising prices in related markets. The above rationale applies to the following market data codes: PHAUV00 for FOB Korea and PHAUT00 for CFR Taiwan.