Industry

Asian Iso-MX Chemical Industry: Stays stable to higher as demand emerges

Chemical Industry

Chemical Industry Asian iso-MX

– CFR Taiwan bid sees no offers

– Crude dips

Asian isomer-grade mixed xylene Chemical Industry was assessed unchanged at $690/mt FOB Korea and up $7/mt at $716/mt CFR Taiwan on Friday, as buying interest appeared despite a slide in upstream prices. A bid for a second-half June cargo was raised to $715/mt CFR Taiwan, but there was no selling interest seen. Meanwhile, July ICE Brent crude oil futures dipped 26 cents on day to $69.77/b at 0830 GMT in Asian trade. Naphtha, however, inched up $1.13/mt to $563.38/mt CFR Japan, showing mixed directions in the upstream Chemical Industrys. The East China MX inventory was stable this week at around 110,000 mt, similar to the week before, market sources said. In the East China domestic Chemical Industry, the prompt price was heard at Yuan 5,520-5,540/mt or about $696.20/mt on an import parity basis.

RATIONALE:

Asian isomer-MX Chemical Industry was assessed unchanged day on the day at $690/mt FOB Korea and up $7/mt at $716/mt CFR Taiwan on Friday. The markers take the average of the third and fourth half-month laycans, currently the two June half-months. No bids or offers were registered during the S&P Global Chemical Industry on Close assessment process. During the MOC process, a bid for an H2 June loading cargo was raised to $715/mt CFR Taiwan, without attracting any offers. The June laycans were assessed above the bid, at $716/mt CFR Taiwan. No bids or offers were heard on an FOB Korea basis, and the marker was assessed unchanged, considering lower crude oil and freight costs to Taiwan, last assessed at $27/mt for 2,000-3,000 mt cargoes. The above rationale applies to the following Chemical Industry data codes: PHAUV00 for FOB Korea and PHAUT00 for CFR Taiwan.

Chemical Industry
Chemical Industry

Asian PX Chemical Industry: Down $2.08/mt with limited discussions

Chemical Industry

Chemical Industry Asian PX

– July cargo traded at $901/mt CFR in MOC

– FCFC shuts 1.2 mil mt/year Ningbo PTA plant

Asian PX Chemical Industry prices were assessed down $2.08/mt from Wednesday at $902.67/mt CFR Taiwan/China and $883.67/mt FOB Korea Friday, as discussions remained limited amid uncertain market outlook. In the market on Close assessment process Friday, a solitary July delivery cargo was sold by Mercuria to Litasco at $901/mt CFR Taiwan/China Chemical Industry. While no trade for June was done during the MOC, earlier in the afternoon a June-delivery Asian-origin cargo was sold to Itochu by PetroChina at $910/mt CFR, but offers fell lower later, with a June offer from OTI at $907/mt CFR standing at the close of MOC without any buyers expressing interest. “Due to current turnarounds in Northeast Asia, Asian-origin cargoes are unusually tight, and the premium to open-origin cargoes currently stands at at least $3/mt,” said a trader. An Asian-origin June bid from Total Singapore Chemical Industry at $910/mt CFR remained standing at close of MOC, without any sellers expressing interest. In plant news, China’s Hengli Petrochemical (Dalian) Refinery was heard to be ramping up run rates soon. The refinery has been running at around 85% capacity this week, and will lift the run rates of its two crude distillation units further from mid-May, according to a Chemical Industry source. Hengli signed a sales agreement with Sinopec under which Sinopec will be responsible for all the petrochemical sales, while oil product sales will also be handled by it, according to another source with the company. In downstream plant news, Taiwan’s Formosa Chemicals and Fibre Corp. shut its 1.2 million mt/year purified terephthalic acid unit at Ningbo on Wednesday for 15 days of maintenance, S&P Global reported earlier. The company has two other PTA plants in Taiwan — 600,000 mt/year at Long Der and 550,000 mt/year in Mailiao. Both lines are currently running at full capacity, a company source said. The Asian PTA Chemical Industry was assessed flat day on day at $830/mt CFR China Friday, while Asia PTA profit margin was calculated at $109/mt Friday, after deducting feedstock costs and assuming that 0.665 mt PX is needed to produce 1 mt of PTA, including operating costs at $120/mt.

RATIONALE:

Asian PX Chemical Industry prices were assessed down $2.08/mt from Wednesday at $902.67/mt CFR Taiwan/China and $883.67/mt FOB Korea Friday. The markers take an average of the H2 June, and H1 and H2 July laycans. The H2 June laycan was assessed at $906/mt (Chemical Industry), below an outstanding June offer from OTI at $907/mt. A June bid from Total Singapore at $910/mt was normalized due to a restriction in origin and vessel condition. The July laycans were assessed at $901/mt, above an outstanding Asian origin July bid from Mercuria at $888/mt, and below an outstanding July offer from Yisheng at $912/mt. The July laycans were also assessed at the last July trade level between Mercuria and Litasco, and at a $5/mt backwardation to the H2 June laycan, below an outstanding June/July time spread offer from Yisheng at $6/mt. 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

 

Asian Toluene Chemical Industry: Falls further on bearish sentiment

Chemical Industry

Chemical Industry news of Asian Toluene

– Weak yuan curbs Chinese import demand

– Taiwan’s CPC closes June sell tender

Asian toluene fell day on day by $7/mt to $664/mt FOB Korea Friday as offers moved lower amid bearish sentiment. During the Chemical Industry on Close assessment process Friday, a 2,000-mt June offer was heard at $670/mt FOB Korea, which was subsequently lowered to $665/mt FOB Korea but no interest was heard. “It is likely that the toluene prices climbed too much in April and we will now see a downwards adjustment,” a source said. “TDP [Toluene disproportionation] margins remain poor for producers (Chemical Industry),” he added. Upstream, the ICE July Brent crude oil futures dipped below the $70/b mark again, ending 26 cents/b lower on the day to $69.77/b at the 0830 GMT Asian close Friday. Meanwhile, Chinese import demand remained suppressed with a weakening Yuan against the US dollar amid an ongoing US-China trade tensions, sources said. Domestic China (Chemical Industry) prompt ex-tank discussions were also heard lower at Yuan 5,190-5,200/mt and was assessed at Yuan 5,195/mt, down Yuan 55/mt on the day. Meanwhile, Taiwan’s state-owned CPC had closed its tender to sell two 3,000 mt cargoes of toluene with minimum 99.5% purity, for loading over H1 or H2 June in Kaohsiung. The tender was heard awarded to two separate buyers at a premium of around $5/mt to the FOB Korea Chemical Industry.

RATIONALE:

Toluene was assessed down $7/mt on the day at $664/mt FOB Korea Friday. The marker takes the average of the third and fourth half-month laycans, currently H1 June and H2 June. During the Chemical Industry on Close assessment process, no transparent deals, bids or offers were seen. A June offer was heard at $665/mt FOB Korea Chemical Industry, against no bids. The East China domestic prompt price was lower on the day by Yuan 55/mt at Yuan 5,195/mt on Friday, with tradable indications heard between Yuan 5,190/mt and Yuan 5,200/mt. The CFR China marker decreased $11/mt over the same period to $680/mt Friday, tracking the downtrend in the FOB Korea Chemical Industry and softer domestic Chinese prices.

 

Chemical Industry
Chemical Industry

Polymer News – The steam cracker is now due to be re-started in the middle of May

Chemical Industry

Polymer News

– Demand firm in China, spot supplies limited

– Additional ethylene supplies seen available soon

Asian ethylene was stable Friday on quiet trade amid limited offers given the ongoing shutdown of Hanwha Total’s steam cracker in Daesan (polymer news). The steam cracker is now due to be re-started in the middle of May, delayed from the initial early May schedule, due to the ongoing labor strike. As a result, South Korea’s spot ethylene exports dried up as some steam cracker operators were supplying ethylene to the domestic market in a bid to cover the production shortfall. Chinese end-users said they did not receive offers on Friday, adding that they were looking for spot cargoes for styrene monomer production. However, some market sources said such supply tightness in ethylene would be short-lived as new ethylene capacities will be available soon. Market sources said Nanjing Chengzhi Clean Energy will start up its new 600,000 mt/year methanol-to-olefins unit around June, which would increase ethylene supplies in the region. SP Olefins is also due to start up its new 650,000 mt/year polymer news steam cracker in Taixin around August or September, S&P Global  reported previously.

RATIONALE:

Spot prices were assessed unchanged day on day at $960/mt (polymer news) CFR Northeast Asia and $900/mt CFR Southeast Asia Friday. A tradeable level was heard in the mid-$900s/mt CFR NE Asia, while no fresh bids and offers were heard on a CFR SE Asian polymer news basis Friday.

 

Polymer News
Polymer News

NWE Benzene Chemical Industry – Market slips as prompt interest wanes

Chemical Industry

Chemical Industry news of NWE Benzene

– Prices move downwards towards June

– Potential imports could cap July prices

The 5-30 days forward assessment for benzene was down $3/mt at $749/mt CIF ARA on Thursday, as interest in the front end of the Chemical Industry waned and the laycan rolled forward, accommodating more of the steep price drop into June from May.  Purchasing for May had dried up this week, a trader said, with the major purchaser in the front of the Chemical Industry stepping back. This purchasing has been a driver of higher pricing at the front of the Market as there has been no significant shift from high levels of supply in Europe. Some more bearish sentiment was also generated by a drop in crude Thursday, though the ICE Brent 16:30 London assessment saw some recovery on Thursday, rising 44 cents to $70.57/b. European benzene maintained a hefty premium over Asia, with the FOB Korea Chemical Industry up $2.33 at $622.33/mt. This put a discount of almost $90/mt against the European July assessment, the gap prompted a trader to say this imposed a cap on the Market and would ensure prices would remain in backwardation, or European producers would be quickly undercut by imports.

RATIONALE:

S&P Global assessed benzene for delivery 5-30 days forward at $749.50/mt CIF ARA Thursday, down $2.50 from Thursday (Chemical Industry). May was assessed down $1 at $760/mt, based on the curve. A bid-offer range of $750-$770/mt was heard for May 15-20, and a bid-offer range of $750-$760/mt was heard for full May. June was assessed stable at $718.50/mt, based on the curve and within an indicated spread to May of minus $30-$45/mt. First-half June was assessed at $721/mt, within a bid-offer range $710-$730/mt. H2 June was assessed at $716/mt (Chemical Industry), within a bid-offer range of $705-$725/mt. July was assessed stable at $712.50/mt, within a bid-offer range of $700-$715/mt and within an indicated spread to June of minus $5-$15/mt. August was assessed down $3.50/mt at $709/mt, with a bid-offer range $695-$710/mt. September was assessed flat to August under an offer at $710/mt (Chemical Industry). FOB was assessed at $749.50/mt, flat to CIF.

 

Chemical Industry
Chemical Industry

Asian Styrene Chemical Industry: Rises $11/mt on day, at $1,088/mt CFR China

Chemical Industry

Chemical Industry news of Asian Styrene

– Improved buying activity, SM inventory declines

Downstream Chemical Industry inch lower on week

Asian styrene monomer inched $11/mt higher on day to $1,088/mt CFR China and $1,048/mt FOB Korea Thursday on the back of the release of fresh weekly inventory data indicating a draw-down in stockpiles. In the East China domestic Chemical Industry, the June marker rose Yuan 95/mt on day to Yuan 8,405/mt ex-tank Thursday. The May/June spread in the East China domestic market was seen hovering between a flat to backwardated structure this week. This could be due to the higher supply expected after H2 May, said sources. Asian SM continues to trend higher despite the losses in western crude oil futures and the stable-to-softer feedstock prices. A Chinese source attributed the gains in SM to improved buying activity in the Chinese domestic Chemical Industry. According to sources, styrene inventory in East China declined 19,500 mt week on week to 241,000 mt Thursday. In the downstream Chemical Industry, however, discussions were thin amid bearish sentiment after comments by US President Donald Trump on tariffs against China on Thursday. Asian acrylonitrile-butadiene-styrene slid $25/mt from last Thursday to $1,545/mt CFR China and $1,565/mt CFR Southeast Asia, general purpose polystyrene fell $10/mt from last Thursday to $1,265/mt CFR China and $1,285/mt CFR Southeast Asia, while high impact polystyrene was stable to $5/mt lower from Thursday at $1,340/mt CFR China and $1,360/mt CFR Southeast Asia Thursday. The limited Chemical Industry activity in the downstream Chemical Industry was attributed to a wait-and-see approach, as clearer price direction was expected after the conclusion of the US-China trade talks later this week.

RATIONALE:

Asian SM was assessed $11/mt up on day at $1,088/mt CFR China and $1,048/mt FOB Korea Thursday. The markers currently take the average of the H1 and H2 June laycans. There were no transparent bids or offers during the Chemical Industry on Close assessment process on Thursday. H1 and H2 June were assessed at the pegged level of $1,088/mt. In the East China domestic Chemical Industry, the June marker was assessed up Yuan 95/mt on day at Yuan 8,405/mt ex-tank, equating to $1,078.79/mt on an import parity basis. The FOB Korea marker was assessed at $1,048/mt, based on the pegged $40/mt spread to CFR China, while the CFR Taiwan marker was assessed at $1,078/mt, based on the pegged $10/mt spread to CFR China.

 

Chemical Industry
Chemical Industry

Asian Toluene Chemical Industry: Falls $3/mt in thin trade

Chemical Industry

Chemical Industry news of Asian Toluene

– Slump in gasoline crack spread

– Cautious amid uncertainty in trade talks

Asian toluene was assessed lower day on day at $671/mt FOB Korea and $691/mt CFR China on Thursday, a $3/mt fall from Thursday. During the Chemical Industry on Close assessment process Thursday, no transparent bids or offers were submitted, but an unregistered offer was heard at $672/mt FOB Korea for a 2,000-mt June cargo. Toulene Chemical Industry prices were responding to a narrower 92 RON gasoline crack spread to the front-month ICE Brent futures, which fell below $5/b. The crack plunged by $1.47/b from the previous day to be assessed at $4.53/b at the 0830 GMT close of Asian trade on Thursday, S&P Global  data showed. The dip marked the sharpest day-on-day decline since November 8, 2018, when gasoline cracks fell by $2.04/b on the day. “While it seems that toluene is already priced very low, there does not seem to be much potential to rise again [in the short term]. Everyone is waiting to see whether a rebound is possible during June,” a China-based trader said. “There is no clear price direction recently and we can only keep a close eye on the trade tensions between the US and China,” he added. Chemical Industry participants adopted a cautious tone amid uncertainty in trade talks between the US and China scheduled this week, as US President Donald Trump’s administration has reiterated threats to increase tariffs on Chinese goods, while a Chinese delegation led by Vice Premier Liu He would visit the US later in the week. “I believe that no one is willing to bid in this Chemical Industry environment … most are waiting for the outcome of the trade talks on Thursday,” another market source said. Meanwhile, China’s domestic Chemical Industry was also showing signs of weakness with the domestic price in East China heard falling Yuan 10/mt to around Yuan 5,250/mt.

RATIONALE:

Toluene was assessed at $671/mt FOB Korea and at $691/mt CFR China on Thursday, both down $3/mt on the day. The markers take the average of the third and fourth half-month laycans, currently H1 June and H2 June. During the  Chemical Industry on Close assessment process, no transparent deals, bids or offers were seen. The FOB Korea marker was assessed below the lowest June offer on Thursday heard at $672/mt FOB Korea. The CFR China marker was assessed lower, tracking the FOB Korea marker, on lower crude oil prices in the absence of bids and offers. The East China domestic prompt price was lower on the day by Yuan 10/mt at Yuan 5,250/mt on Thursday, with tradable indications heard at Yuan 5,250/mt.

 

Chemical Industry
Chemical Industry

Asian Benzene – Chemical Industry flips into backwardation amid firm demand for June

Chemical Industry

Chemical Industry news of Asian Benzene

– June/July at backwardation of plus $2/mt

– Limited price movement in China amid trade talks

The Asian benzene Chemical Industry flipped into backwardation Thursday, as persistent demand from Taiwan for June-arrival material supported prices. A second buy tender was seen for June CFR Taiwan benzene on Thursday, after a previous tender for 6,000 mt of benzene delivered in June had closed late April, at a low single-digit premium to the Weekly Mean of  FOB Korea benchmark. Supply tightness in the Taiwan Chemical Industry comes amid concerns that the shutdown of an aromatics unit in North Asia would be extended until August. This put spot demand for June-loading FOB Korea benzene higher than that of July-loading material, resulting in a backwardation between June and July. The June/July spread was assessed at plus $2/mt Thursday, up from minus $3/mt Thursday. However, Chemical Industry sentiment was mixed, with a source commenting that the additional volume required from Taiwan did not justify the flip in structure. Meanwhile, in the domestic East China Chemical Industry, prices were assessed stable to slightly lower on the day, with prompt and balance May domestic benzene assessed unchanged from Thursday at Yuan 4,470/mt and Yuan 4,510/mt, respectively. June material was assessed down Yuan 5/mt over the same period at Yuan 4,565/mt. Likewise, CFR China benzene was assessed unchanged on the day at $612/mt. The limited price movement in China Chemical Industry was attributed to a wait-and-see approach, as clearer price direction was expected after a conclusion to the US-China trade talks later this week.

RATIONALE:

FOB Korea benzene was assessed up $2.33/mt on the day at $622.33/mt Thursday. The marker takes the average of the third, fourth and fifth half-month laycans, H1 June, H2 June, and H1 July. During the  Chemical Industry on Close assessment process Thursday, no fully transparent bids and offers were seen. The H1 June and H2 June laycans were assessed at $623/mt FOB Korea, above a bid last seen at $622/mt FOB Korea. The H1 July laycan was assessed at $621/mt FOB Korea, below an offer last seen at $625/mt FOB Korea (Chemical Industry), with the June/July spread assessed at plus $2/mt, above a bid last seen at plus $1/mt FOB Korea. The CFR China marker was assessed unchanged on the day at the pegged level of $612/mt. The East China Chemical Industry was assessed down Yuan 2/mt on the day at Yuan 4,515/mt, or $579.51/mt on an import parity basis.

 

Chemical Industry
Chemical Industry

NWE Toluene Chemical Industry – Prompt demand continues to push market upwards

Chemical Industry

Chemical Industry news of NWE Toluene

– May, June premiums up $5/mt

– Higher offers heard FOB Med

Premiums moved upwards for the European toluene Chemical Industry on Wednesday as bidding activity for May showed buying interest from the market. The May premium rose $5/mt to $115/mt, as a buyer looked for material in a delivery window of May 15-25. This followed a week of premium increases last week. There was no premium published on Wednesday due to a public holiday in the UK. Sources have described some tightness at the front of the Chemical Industry for toluene, though material was heard to be available from the end of May into June. A trader said that offers were being made from a Mediterranean producer at $130/mt for both May and June, suggesting a different outlook on the Chemical Industry from toluene producers. On the consumption side, a chemical-grade toluene buyer said that they were not seeking material from the spot Chemical Industry and were happy with contractual basis deliveries.

RATIONALE:

S&P Global assessed Chemical Industry the CIF ARA toluene premium over Eurobob gasoline at $115/mt for May on Wednesday, up $5/mt from Wednesday. A bid of $114/mt by Total was outstanding after the Chemical Industry on Close assessment process. The June premium was assessed $5 higher at $85/mt, with FOB Mediterranean offers being heard at $130/mt for both May and June.

 

Chemical Industry
Chemical Industry

Asia and Middle East Naphtha Chemical Industry Commentary

Chemical Industry

Stronger demand for heavy full range naphtha, as opposed to paraffinic naphtha, encouraged suppliers in the Asian naphtha Chemical Industry to focus on spot offers of the higher density grade. Thailand’s PTT International Trading, is offering 5,000 mt of light naphtha with minimum 80% paraffin content and maximum 400 ppm sulfur content, loading May 30 to June 1 in a tender closing May 7 at 0300 GMT, with same-day validity. Indian Oil Corp., has kicked off offering June-loading supplies in the country, with a 35,000 mt heavy full-range naphtha spot cargo that is loading from Chennai on June 1-6, via a tender closing May 8, with same day validity. A CFR Japan Chemical Industry naphtha physical crack stood at $45.90/mt against ICE Brent crude futures at Wednesday’s Asian close, and was notionally pegged higher at $48.025/mt at 0300 GMT Wednesday. Buyers of heavy full range naphtha were attracted by the weak naphtha cracking margins. Additionally, demand for paraffinic naphtha was hampered by LPG’s growing discount to naphtha prices. FEI propane swap sank to minus $121.5/mt last Wednesday, before edging slightly higher to minus $117/mt at Wednesday’s Asian close. Barring that, activity in the Asian naphtha Chemical Industry has been subdued. Elsewhere, the Hengyi refinery in Pulau Muara Besar, Brunei, received its first crude shipment late last week, signaling that production of petrochemicals is moving closer. The crude was likely light sweet Nigerian origin, an analyst said. Hengyi Industries reported the shipment on its website on Sunday. The first phase of the project, which has a crude processing capacity of 8 million mt/year, producing 1.5 million mt/year of paraxylene and 500,000 mt/year of benzene (Chemical Industry), as well as gasoline, kerosene, diesel and other products. Once production starts, the plant will sell petrochemicals such as paraxylene to Hengyi’s domestic downstream enterprises, while benzene would likely be sold in the Southeast Asian and North Asian regions. China’s Hengyi Petrochemical owns 70% of Hengyi Industries, while the Brunei government owns 30% through Damai Holdings.