Naphtha Price in India

Methanol Prices

Chemical Industry

Weak MEG, PTA Chemical Industrys impact domestic prices

Ample inventory in S Korea, Taiwan

Sentiment in the Chinese Methanol Prices was weak Friday following the monoethylene glycol and purified terephthalic acid market. Methanol end-users kept their buying indications unchanged at $260/ mt CFR, while selling indications ranged from $270/mt CFR to a premium of 1%-2.5% to formula price. A trade for a 5,000-mt cargo of Southeast Asian origin Methanol Prices was heard done at $293/mt CFR for mid-May arrival. End-users and Chinese traders said the methanol Chemical Industry was expected to see some downside next week and the $293/ mt level was not repeatable. The most actively traded September contract on the Zhengzhou Commodity Exchanged closed Yuan 68/mt lower at Yuan 2,291/mt Friday. In South Korea, traders had ample inventory and domestic demand was tepid, sources said. Domestic cargoes were traded at Won 385/kg (Methanol Prices), same level as last week, trade sources said. Trading was thin in Taiwan. “It’s a very weak market with ample supply and weak demand, following the softening China market,” a trader said. Elsewhere in India, a Middle East producer sold 10,000 mt of Methanol Prices to an Indian trader via a tender which closed Friday at $337/mt CFR. The cargo is expected to arrive at West Coast India around May 14.

Rationale

CFR China Methanol Prices were assessed at $279/mt, down $7/mt day on day, tracking steep falls in domestic prices and below an offer at $293/ mt CFR for cargoes arriving in the second-half May. Chinese domestic prices fell Yuan 46/mt day on day and Yuan 83/mt week on week, to Yuan 2,292/mt Friday, amid discussions heard at Yuan 2,280-2,300/ mt (Methanol Prices). The CFR Southeast Asia marker was assessed at $333/mt Friday, unchanged from Friday and below an offer at $335/mt CFR. The CFR Korea marker was assessed steady week on week at $325/mt and below an offer at $330/mt CFR. The CFR Taiwan marker was assessed at $294/mt Friday, down $6/mt (Methanol Prices) on week, tracking the Chinese market (Methanol Prices).

 

Methanol Price
Methanol Price

Asian CPL Chemical Industry: Stays stable with April CP concluded at $1,790/mt CFR

Chemical Industry

Chemical Industry news of Asian CPL

– No notable pickup in demand ahead of May 1

– Supply to remain tight amid turnarounds

Trading in the Asian caprolactam Chemical Industry was thin over the week to Friday sources said. This was in contrary to previous years when there is typically a pick-up in demand ahead of the May 1 holidays, they added. The China market will be closed for most of next week for the May 1 holidays, sources said. Buyers were taking a wait-and-see approach, opting to procure material after the holidays with prices seen staying rangebound through April. A Chemical Industry participant said that buying was more “cautious and conservative” this year. Supply was expected to tighten moving forward, amid turnarounds at major producers in Taiwan and China. Sumitomo Chemical’s April contract price for caprolactam was concluded at $1,790/mt CFR, up to $20/mt from March. In the downstream nylon Chemical Industry, demand for nylon chips seen at $2,050-$2,060/mt CFR Far East Asia. Inventory levels were also higher in the week.

RATIONALE:

Asia caprolactam was assessed unchanged on the week. CFR Fareast Asia was assessed at $1,750/mt CFR Fareast Asia, based on tradable indications heard at the level, and below offers at $1,790/mt. CFR Southeast Asia was assessed at $1,725/mt, keeping the CFR Fareast Asia-CFR Southeast Asia Chemical Industry spread unchanged on the week.

 

Chemical Industry
Chemical Industry

US MTBE Chemical Industry: Discount to Northwest Europe hits double digits

Chemical Industry

– FOB USG 10.66 cents below FOB ARA

– MOC offer seen at 213 cents/gal FOB USG

While spot USG MTBE fell less than 4 cents day on day, its discount to Northwest Europe hit double digits Friday. In the Friday Chemical Industry on Close assessment process, Lukoil entered with an offer at 221 cents/gal FOB USG, moving it down to 213 cents/gal FOB USG. No bids or trades were confirmed over the day. With the MOC process offer, spot Gulf Coast pricing was pushed down 3.61 cents/gal. In Europe Chemical Industry, however, pricing was up 4.64 cents/gal to 223.41 cents/gal. With opposite price movements in the two regions, Gulf Coast pricing was assessed at a 10.66-cent discount to its Northwest European counterpart. In related energy, NYMEX May RBOB fell 3.83 cents to $2.0309/gal. Blended and shipped values were last estimated near 257 cents/gal while the MTBE factor relative to gasoline was at 1.0567. In Asia, the FOB Singapore marker was up $15/mt (about 4.22 cents/gal) to $774/mt (about 217.80 cents/gal).

RATIONALE:

Spot USG MTBE was assessed Friday at 212.75 cents/gal FOB USG, down 3.61 cents on the day. The assessment came below an offer in the Friday Chemical Industry on Close assessment process at 213 cents/gal FOB USG.

Chemical Industry
Chemical Industry

NWE Benzene – Market pulled higher by crude

Mathanol Prices

– Thin bids and offers

– Indications of prompt market for May

Benzene was up $8/mt in Europe on Thursday, with the CIF ARA 5-30 days forward loading assessment at $724/mt. Despite a trade heard for April laycans, activity in the market was sparse, with few bids and offers heard from elsewhere. Ranges may be developing for the first half of May, a trader said, implying some immediate shortness in the front end of the month. But the overall global supply situation for benzene remained long, he said, with little expected to change that. Some upheaval is anticipated by the market in the coming months, as both steam crackers and styrenics production units enter turnarounds. On the whole, benzene prices have been carried upwards by a bullish crude market this week. The upwards trend for crude continued on Thursday, with the ICE Brent 16:30 London assessment up 70 cents to $71.37/b.

RATIONALE:

S&P Global  assessed benzene for delivery 5-30 days forward at $724/mt CIF ARA Thursday, up $8/mt from Tuesday. April was assessed up $9/mt at $730/mt, based on a trade heard at this level on Thursday. May was assessed up $9/mt at $715/mt, keeping a backwardation of $15/mt to April amid no disproving indications. June was assessed at $704/mt, up $9/mt in line with May. July was assessed at $703/mt, up $9/mt in line with June. August was assessed flat to July. FOB was assessed at $724/mt, flat to CIF.

Chemical Industry
Chemical Industry

Asia and Middle East Naphtha Market Commentary

Chemical Industry

The Asian naphtha market remained under downward pressure due to lukewarm buying interest from Far East Asian end-users for H2 May delivery clips as some crackers in Northeast Asia were shut for scheduled maintenance, sources said Thursday. In addition, an aromatics plant outage at Taiwan’s privately-owned Formosa Chemicals and Fibre Corp. (FCFC) has reduced Formosa Petrochemical Corp.’s (FPC) requirements for heavy naphtha and may have some impact on its steam cracking naphtha demand. FPC will not be seeking heavy naphtha for second-half May delivery, while its paraffinic naphtha requirements were still unclear after Sunday’s explosion and fire at one of its aromatics plants, a company spokesman said. An explosion and subsequent fire that broke out at FCFC’s No. 3 aromatics plant at Mailiao resulted in disruption to the link that diverts pygas from the cracker unit. “The feed into that aromatics plant is pygas produced by their cracker, so if the aromatics plant is shut down due to the explosion, then the cracker cannot run and store the pygas produced,” a Singapore-based market source said. Formosa’s cracker was heard running at lower rates due to the shutdown of the aromatics unit, a Singapore-based LPG trader said. This could not be confirmed with Formosa. One of the company’s olefins buyers said that Formosa is still attempting to run its steam cracker at 100%. Reflecting the weaker market, the CFR Japan naphtha crack against front-month June ICE Brent crude futures contract fell to $37.25/mt at the Asian close Tuesday, down from $41.43/mt the previous day. The crack was pegged at $40.20/mt at 0300 GMT Thursday. Spot cash differential for CFR Japan naphtha fell to a near three-month low of $4.25/mt Tuesday. The differential was last lower on January 15 at $3/mt, S&P Global  data showed. Meanwhile, supply continued to stream out from India. State-owned refiner Bharat Petroleum Corp. Ltd. was offering 35,000 mt of naphtha with minimum 76% paraffin and maximum 350 ppm sulfur for May 2-3 loading from Kochi in a tender closing April 12, with same-day validity. In plant news, India’s state-owned Hindustan Petroleum Corp. Ltd.’s 8.3 million mt/year Vizag refinery on the east coast is running normally after a major fire disrupted operations for a couple of hours over the weekend, company officials said. The fire broke at the continuous catalytic reformer on Thursday afternoon and was contained in about half an hour. “The refinery operation is smooth with no hiccups,” a refinery official said.

Asian Phenol/Acetone Chemical Industry – Phenol prices tumble as China demand weakens

Chemical Industry

PHENOL: Asian prices tumbled this week as demand in China was weakening, and prices in the Indian Chemical Industry were heard following suit. The CFR China and the CFR India markers were both assessed lower week on week by $90/mt to $1,010/mt and $1,050/mt, respectively. Market sources said the key reason for the price fall was declining downstream demand in China as plants were lowering operating rates or shutting down due to safety checks following several explosions at chemical plants in Jiangsu province in recent weeks. “China is bearish,” a trader said this week, adding that offers were close to $1,025/mt CFR China chemical industry. A buyer in China said their bid at the moment was only $950-$980/mt CFR China. The domestic price of phenol in East China slipped to Yuan 7,700-7,800/mt this week, or about $968.20/mt on an import parity basis. In related news, Taiwan’s China Petrochemical Development Corporation on Thursday shut its 200,000 mt/year caprolactam plant in Toufen for one month of maintenance, a source close to the company said Thursday. The source added that the company’s phenol inventory level is high, and that phenol prices in Northeast Asia are under pressure due to low demand in China amid safety checks at plants following several chemical plant explosions in Jiangsu. Phenol is the feedstock to produce caprolactam. Chemical Industry sources said phenol bids on a CFR China basis this week were falling to below $1,000/mt.

ACETONE: Prices were also under pressure for acetone this week with the CFR India marker assessed down $40/mt to $390/mt, close to tradable levels estimated by Chemical Industry sources. The China Chemical Industry was also under pressure for the same reasons as phenol, but domestic price in East China was heard stable at Yuan 2,925/mt, or about 365.43/mt on an import parity basis. The CFR China marker was assessed lower on week by $10/mt to $380/mt, above buy ideas heard at $330-$340/mt CFR China.

Chemical Industry
Chemical Industry

Asian PX: Up $13.67/mt from Tuesday, tracking bullish PTA futures higher

Chemical Industry

– Taiwan’s FCFC No.3 aromatics unit shut due to fire

– June trades at $1,049/mt CFR Taiwan/China

Asian PX prices were assessed up $13.67/mt day on day at $1,052/mt CFR Taiwan/China and $1,033/mt FOB Korea Tuesday, tracking bullish downstream Chinese purified terephthalic acid futures higher. The most actively traded May PTA futures on the Chinese Zhengzhou Commodity Exchange rose Yuan 134/mt, or 2.08%, day on day to Yuan 6,576/mt at close of afternoon trading Tuesday. Active buying interests were seen throughout Tuesday morning, after an explosion and subsequent fire broke out at Taiwan’s Formosa Chemicals and Fibre Corp.’s No. 3 aromatics plant at Mailiao on Sunday, a company spokesman told S&P Global Tuesday Tuesday. “The fire was due to an explosion at the liquefied petroleum gas pipeline that feeds LPG to the isobutene fractionation tower,” the spokesman said. The plant has been shut following the explosion on Sunday. The No. 3 plant has the capacity to produce 900,000 mt/year of paraxylene, 640,000 mt/year of benzene and 240,000 mt/year of orthoxylene, and is not scheduled for maintenance shutdown in 2019. The company has plans to shut its No. 1 aromatics plant at the same location from the middle of April to the end of May for annual maintenance, Tuesday reported earlier. The company also plans to shut its No. 2 aromatics plant at the same location for two to three weeks from the middle of August, which has the capacity to produce 287,000 mt/year of paraxylene, 213,000 mt/year of benzene and 80,000 mt/year of OX. Following news of the shutdown of FCFC’s No.3, market discussions for PX soared early Tuesday in Asia, with bids for May delivery CFR Taiwan/China cargoes seen at $1,070/mt, against offers at $1,120/mt CFR. The incident will affect supply of aromatics in the Taiwanese market, sources said Tuesday. Buyers of aromatic products from the unit were heard affected, but the total volume of affected material could not be ascertained. Discussions fell lower in afternoon trading after news emerged that FCFC No.3 could resume operations at the end of the week, although this could not be immediately confirmed with the company. In the Tuesday Market on Close assessment process Tuesday, two trades were seen for June delivery, both at $1,049/mt CFR Taiwan/China, while an outstanding May bid by GS Caltex was left standing at $1,057/mt CFR Taiwan/China at close of MOC, with no traders expressing further interest. The May/June backwardation was assessed at $9/mt Tuesday, up $2/mt on the day.

RATIONALE:

Asian PX prices were assessed up $13.67/mt day on day at $1,052/mt CFR Taiwan/China and $1,033/mt FOB Korea Tuesday. The markers take an average of the H2 May and H1 and H2 June laycans. The H2 May laycan was assessed at $1,058/mt, above an outstanding open origin May bid from GS Caltex at $1,057/mt. The June laycans were assessed at $1,049/mt CFR Taiwan/China, at the level of the last June trade between Litasco and Yisheng, and above an outstanding Asian origin June bid by GS Caltex at $1,050/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. The above rationale applies to the following market data codes: “PHASS05” for FOB Korea and “AAQNE00” for CFR Taiwan/China.

PTA Chemical Industry

Chemical Industry

Market sentiment causes volatile Chinese PTA „„

PTA imports cheaper post VAT revision

Asian purified terephthalic acid spot trade discussions were quiet Friday amid the Chinese Chemical Industry. The PTA CFR China Chemical industry was relatively stable this week, but the China domestic PTA prices fell by Yuan 195/mt early this week, followed by a rebound of Yuan 170/mt day on day Friday. Chinese trade participants were speculative this week amid the turnaround news. “Even though Chinese PTA prices were volatile this week, the overall trend remains stable within a longer time frame [of around 2-3 weeks],” a PTA buyer said, adding that price fluctuation was mainly driven by chemical industry sentiment. With the value added tax cut from 16% to 13% effective April 1, PTA imports became cheaper than China domestic products, with the average spread of around $11/mt this week. As a result, there were active buying inquiries heard, with CFR China deals closed for 2,000 mt-20,000 mt cargoes from northeast Asia. Similarly, even though upstream PX was volatile throughout this week, the CFR Taiwan/China marker was assessed at $1,039.88/mt in average this week, similar to the average of $1039.65/ mt last week. In India chemical industry, demand from the textile sector was heard to have not improved, leading to accumulation in polyester finished goods, a few producers said. The inventories were high enough to meet demand for the next three weeks, sources said. Nevertheless, there were “still no major production cuts” in the polyester sector amid expectations of improvement, leading to healthy demand for PTA, sources said. Spot discussions were scarce for CFR India Chemical Industrial market this week. In plant news, China’s TongkunGroup plans to shut its 2.2 million mt/year PTA line in Zhapu, Zhejiang, for around 15-20 days of maintenance from early April, a company source said Friday. China’s Hengli Petrochemical plans to shut its 2.2 million mt/year No. 1 PTA unit in Dalian for 15 days maintenance from April 15, a company source said Friday. China’s Fujian Fuhaichuang Petrochemical plans to shut its 1.6 million mt/year paraxylene and 4.5 million mt/year PTA plants in Gulei, Fujian province, early May for at least two weeks, a company source said Friday (chemical industry). Separately, multiple chemical plant explosions in China increased concerns over stricter safety inspections. According to market sources close to major polyester and purified terephthalic acid companies in east China, there has not been any official statement yet regarding shutdown for safety inspection. The sources added that the impact was “terrible” with stricter safety regulations expected soon.

Rationale

The CFR China PTA Chemical Industrial price was assessed flat day on day at $840/mt on Friday for 15-30 days forward cargoes, with scarce discussions amid the Chinese public holiday. China prompt domestic price was assessed flat at Yuan 6,510/mt over the same period for the Chemical Industry. Both CFR Southeast Asia PTA and CFR India PTA were assessed down $5/ mt week on week at $850/mt on Friday, amid scarce spot discussion this week, keeping the spread at $10/mt against CFR China.

 

Chemical Industry
Chemical Industry

Methanol Chemical Industry

Chemical Industry

Muted sentiment in China, Taiwan

End-April arrival spot cargo scarce in SE Asia

Fundamentals in the South Korean Chemical industry were mostly balanced even as domestic prices rose Won 5/kg to Won 390/kg (34 cents/kg) and a major South Korean acetic acid plant shutdown this week for planned maintenance. “Small-sized user demands were slightly weak, but it did not influence the South Korean chemical industry. Demand from mid-large companies, except Lotte BP, was healthy,” a trader said. Lotte BP Chemicals shut its 550,000 mt/year acetic acid plant at Ulsan for a turnaround and debottlenecking on Friday and will restart at the end of April. A trade for a 5,000-mt cargo arriving around the end of April and the first half of May was heard done Friday at $327/mt CFR Korea (chemical industry). In Southeast Asia, fundamentals were mostly stable except for one end-user requiring 3,000-5,000 mt of methanol for April 25 to May 5 arrival. The buyer had approached a number of sellers but few had product for that particular arrival laycan, except for one who was heard offering end-April to May 5 arrival cargoes at $350/mt CFR Southeast Asia. Elsewhere, sentiment was muted in China and Taiwan as markets (chemical industry) there were closed for a public holiday.

Rationale

Methanol was assessed stable on the day at $296/mt CFR China Friday for cargoes delivered 20-50 days forward, as was Chinese domestic prompt spot cargoes at Yuan 2,440/mt, unchanged day on day, since China was closed for a public holiday. The CFR Southeast Asia  chemical industry was assessed at $331/mt Friday, up $4/mt from Friday, above a buying idea heard at $330/mt CFR and under a selling idea heard at $350/mt CFR. The CFR Korea chemical industry rose $2/mt week on week to $327/mt CFR based on a trade done at $327/mt CFR Friday for a 5,000-mt cargo arriving at the end of April onwards. The CFR Taiwan marker was higher $3/mt week on week at $303/mt CFR, tracking firmer regional prices.

Asian toluene rose $1/mt-$5/mt to be assessed at $703/mt CFR China and $681/mt FOB Korea,

Chemical Industry

– Spot market bulls not felt in domestic China

– East China prompt ex-tank price stable on day

Asian toluene rose $1/mt-$5/mt to be assessed at $703/mt CFR China and $681/mt FOB Korea, respectively, on bids heard during the Friday Market on Close assessment process Friday. During the MOC, a best bid was heard at $680/mt FOB Korea for any May loading. No bids or offers were heard for CFR China, though a bid was heard at $695/mt CFR China for any May delivery in the afternoon, before the MOC started, and an any May bid was heard at $677/mt FOB Korea earlier Friday. Despite bullishness in the spot market, most participants in China maintained a cautionary stance on the back of another explosion at a factory in Jiangsu, east China. “Factories in some parts of east China have stopped. The market sentiment has definitely been affected because of the numerous incidents that have occurred over the past month or so. There definitely will be retrospective and detailed investigations into downstream production,” a Chinese source said Friday. Domestic East China prompt ex-tank was heard discussed at Yuan 5,380-5,420/mt the entire day and was assessed at Yuan 5,400/mt, converting to an import parity of $661/mt, largely unchanged from the day before. “Toluene prices in China are on a slight uptrend. Main thing is traders are bidding up prices,” a Chinese toluene end-user said. A southeast Asian trader said “I think prices now are reasonable, but whether or not prices will come down remains to be seen, since China ports are going to face inspection for DG Chemicals. Zhang Jia Gang already received a sudden notice yesterday to stop importing aromatics, several terminals in Zhang Jia Gang are affected.”

RATIONALE:

The FOB Korea marker was assessed at $680/mt FOB Korea Friday, up $5/mt from the previous assessment day, and was assessed above a best bid heard at $680/mt FOB Korea during the Friday Market on Close assessment process Friday. The CFR China marker was assessed at $703/mt Friday, also up $1/mt from Friday, tracking the FOB Korea higher. The FOB Korea and CFR China markers take the average of the third and fourth half-month laycans, currently H1 and H2 May. H1 May was assessed at $703/mt CFR China and H2 May at $703/mt CFR China on Friday, maintaining the market’s flat structure from the day before, tracking the domestic Chinese market.

 

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