Styrene markets at a standstill

07 October 1995 00:00  [Source: ACN]

NAPHTHA buyers in Japan and South Korea are said to be covered for July and are looking for physical deals for August. August availability is reported to be tightening. TOC, Thailand has enquired for 10-15 000 tonne and was close to concluding with a Singaporean supplier as ACN went to press. There is confusion over whether Asian buyers have yet officially concluded contracts with KPC, Kuwait (ACN 3 July, p26). MOPJ was put at US$176/tonne mid-week, falling in line with crude. Physical quotes for August were jumbled, quoted mid-week at MOPJ plus US$0.5-$1/tonne on a fixed price basis and MOPJ minus US$1/tonne on a floating basis, although one source insisted that both fixed and floating deals were priced at MOPJ plus US$2-3/tonne. The Singapore paper price mid-week was US$17.65/bbl for August.

Ethylene activity has increased in Korea following cracker turnarounds. Korean producers have export availability and one 2500 tonne Korean cargo was confirmed at US$430-440/tonne cfr Indonesia for July delivery. Another 3000 tonne deal was concluded at US$340/tonne fob Korea for August delivery to SEA.

Indonesia is also importing cargoes from Japan at US$450/tonne cfr Indonesia for August delivery. Price ideas are reported at US$320-340/tonne fob Korea for August deliveries.

Bulk chemical spot prices - US$/tonne
	Asia/Pacific spot		US/Euro contracts
	NE Asia1	SE Asia2	US3	NWE4
Naphtha	1767	171.456 fob Sing	N/A	N/A
Ethylene	4656 cfr Taiwan	430-450 cfr Indonesia	0.29-0.335/lb FD April	930
Propylene5	530	5806	0.2475/lb April	750 Q3
Butadiene	400 cfr China8	N/A	0.23/lb June	675 Q3
Benzene	295-3009	350 cfr wc India	0.90/gal July	415
Toluene	295	3106	0.78-0.80/ gal June	360 fob Q3
Xylenes	419 cfr Taiwan6	-	1.00/gal July	N/A
Styrene	12006	-	0.51-0.53/lb	1875-1920
Paraxylene	1810 cfr Korea6	N/A	0.36/lb FD Q2	1167
Orthoxylene	670-680 cfr Korea	750 cfr India6	0.36/lb June	1350
Methanol	180-190 cfr Japan	200-22010	0.50-0.55/gal barge	250 fob Q3
MTBE	280-2856 cfr Taiwan	2858 6 fob Sing	N/A	1.35
Ammonia	249 cfr Taiwan	235 cfr wc India	N/A	N/A
1 prices are fob Korea unless indicated; 2 prices are cfr SEA unless indicated; 3 US prices are May contract levels on an fob basis unless otherwise indicated; 4 European FD Q2 contract price in DM/tonne, courtesy of ECN; 5 propylene is polymer grade; 6 no known recent business; 7 MOPJ quote; 8 for July delivery; 9 offers; 10 price ideas for July delivery. Prices contained in this report are obtained through consultation with producers, consumers and merchants in the regions indicated. They are intended as a guide to price levels of recent business and reflect medium to large tonnage sales. Spot prices are quoted as indi- cated: cfr - cost and freight; fob - free on board; cif - cost, insurance and freight; FD - free delivered. Spot prices in this issue are based on information available mid-week prior to the date of issue. Dollar prices are based on rates of exchange prevailing at this time.

Propylene is still tight in NEA as a result of Japanese shutdowns and regional demand is slack. One 1000 tonne fixture for China was reported at US$530/tonne fob Korea for July delivery. A Chinese bid was received by one producer at US$540-550/tonne cfr China, with no deal concluded. SEA consumers are believed to be looking for deep sea material from AG and Venezuela for example, apparently reducing buying interest for Korean product in SEA. PCS continues to store all of its non-contractual propylene in readiness for its October turnaround.

Speculation regarding tight butadiene supply may have resulted from a temporary shipping delay from Korea. Buyers report that butadiene is readily available and two fixtures are reported from Korea: one 1000 tonne lot at US$400/tonne cfr Taiwan for August delivery and another 1000-1500 tonne parcel at US$400/tonne cfr China for July shipment. Korean producers' offer prices are around US$330/tonne fob Korea.

Benzene markets remain quiet. A 5000 tonne cargo of SEA material was sold for August delivery at US$350/tonne cfr west coast India. Indian buyers continue to enquire for a total of 4-5000 tonne at US$335/tonne cfr, although suppliers are offering US$350/tonne cfr. The US contract for July has fallen 15 cents/gal to 90 cents/gal, depressing the already weak Asian market. Korean selling ideas are reported around US$295/tonne fob or lower, although one producer claims offers have not dropped below US$300/tonne fob Korea for July. Buyers are indicating that prices of US$275-280/tonne fob Korea would be acceptable for July/August delivery and China is enquiring for benzene at US$300/tonne cfr for July shipment, which nets back to US$270/tonne fob.

Toluene inventories are substantial and traders remain cautious, not yet willing to take positions. One sale of 1500 tonne has been reported to a Japanese gasoline blender at US$295/tonne fob Korea for July delivery to Kawasaki. CPC issued a tender which closed on 5 July for 2500 tonne for delivery either early or late September. Bids had not been opened as ACN went to press.

Mixed xylenes markets remain calm with offers of solvent grade from Korea reported US$310-330/tonne fob for July shipment. Isomer grade is on offer at US$350-360/tonne fob Korea for July, although sellers may be prepared to reduce prices to US$340/tonne fob. One source indicated Korean isomer grade offers as low as US$330/tonne fob. Some expect July prices to fall to US$320/tonne cfr China for solvent grade, following the US July contract price dropping 25 cents/gal to US$1.00/gal. Customers are currently not in a position to purchase due to high inventories. Traders' offers of 5000 tonne isomer grade US material at below US$340/tonne cfr Korea for early August loading have met with no interest. Chinese buying ideas for isomer grade are reported around US$350/tonne cfr.

Styrene markets have come to a standstill. Enquiries are non-existent and buyers and sellers are merely exchanging opinions, rather than actually negotiating for business. Consumers' and producers' inventories are very high and China appears no closer to resuming purchases (see left column, below).

The paraxylene spot market remains slow, although the Q3 Asian contract price has now been settled at USCP plus 6 cents/lb. European product offered into Asia has been met with caution and consumers are said to be negotiating hard (ACN 10 July p24). Notional prices are being discussed and a sale to Korea of 2-3000 tonne is rumoured at US$1800-1820/tonne cfr.

Orthoxylene price levels remain unclear, with no confirmed business. One report indicated a sale to Korea at US$670-680/tonne cfr, although another source refuted this as too high. Japanese traders are talking prices of US$650-660/tonne fob Japan, representing a landed price of US$670-680/tonne cfr Korea. No enquiries have been reported and suppliers' stocks are said to be high.

Methanol spot fixtures for July delivery to NEA from AG were confirmed at US$180-190/tonne cfr Japan and US$180-185/tonne cfr Taiwan for July delivery. Price ideas for SEA are in the region of US$200-220/tonne cfr SEA from AG for July delivery of small parcels.

MTBE producer ideas are said to be around US$280/tonne fob Korea at present. Buying interest for MTBE is reported to be stable and low. CPC is said to be closing a tender on 11 July for 3500 tonne of MTBE for second half August arrival.

Ammonia markets are quiet. CPDC awarded its 27 June tender for 12-15 000 tonne to Sanapik at US$249/tonne cfr Taiwan for delivery 17-30 August. Sanapik has been negotiating with Norsk Hydro and Transammonia the sale of the excess 5000 tonne aboard the Hesiod bound for TFC, Taiwan (ACN 26 June, p25). FAI, India is said to be discussing potential spot deals from major suppliers, but may also buy on contract. Prices ex-Yuzhnyy have weakened to US$180-185/tonne fob, with good availability.

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