– Deal seen at $170/mt
– Backwardation points to greater supply seen ahead
Toluene’s March premium to Eurobob gasoline was assessed stable at $170/mt and April was assessed stable at $165/mt. The backwardation reflected market talk of greater availability in April. Two European production plants are still closed but a lack of spot demand has allowed material to accumulate nonetheless. A trader said demand was relatively strong on Tuesday and that toluene supplies were no longer very tight. On Tuesday, European prices dipped below US numbers for the first time since January for relevant arrival dates, though the arbitrage window remained shut. Toluene was assessed at $719.25/mt CIF ARA on Tuesday. In the US, April was assessed at $726.56/mt FOB. The relevant freight route was last assessed at $36.50/mt on Tuesday.
S&P Global assessed the CIF ARA toluene premium over Eurobob gasoline at $170/mt for March on Tuesday, stable from Tuesday. During the Market on Close assessment process, Litasco sold 1,000 mt of TDI grade toluene to Total for pricing March 5-31, delivery March 11-21 at a premium of $170/mt over the Eurobob gasoline March swap. The April premium was assessed stable at $165/mt, with no disproving indications.