06 September 1997 00:00 [Source: ACN]
Ethylene prices remain firm reflecting continuing tight supply
Naphtha: Quotes for open-spec material were US$208-210/tonne cfr Japan for first-half August delivery. A South Korean buyer purchased a 25 000-tonne cargo at a discount of less than US$1/tonne below MoPJ for second-half July delivery.
Ethylene: Prices remained firm as there was no let-up from tight supplies in the region. Petrochemical Corp of Singapore (PCS) continued to have operating problems with its 515 000 tonne/year PCS II cracker, which was still constrained to 60-70% of capacity last week.
Offer prices stayed at US$730/tonne cfr SEA for June delivery. SEA prices were being propped up by the requirement for Ethylene Malaysia's maintenance turnaround, sources said.
NEA prices were also strong as demand remained high. South Korean producers were operating crackers flat out, despite cutting back on styrene and lldPE production, because of the strong demand for ethylene. Offer prices were US$630/tonne fob Korea or higher for June lifting, although export availability remained limited.
Taiwanese buyers paid US$700/tonne cfr for June cargoes to cover Chinese Petroleum Corp's No4 cracker shutdown. Markets are expected to remain strong until mid-July when supply will increase as crackers restart after completing turnarounds.
Propylene: Offer prices in SEA were generally in the US$590-595/tonne cfr range. One offer was reportedly as low as US$550/tonne cfr SEA, but this was for a small local-origin cargo of only 1200 tonne, sources said. Buyers were reportedly not making serious bids for cargoes, however, because falling PP prices were again raising concerns about the erosion of margins (ACN 9 June p44).
South Korean producers were offering limited quantities for June export at US$520-530/tonne fob, but preferred domestic markets where netbacks are higher. Chandra Asri and TriPolyta were still discussing the price of long-term supply.
Butadiene: Markets were quiet as buying interest remained low. South Korean producers are keen to ship cargoes to the US now that business to China is so slow and European exports to the US are below usual volumes. No fixtures had yet been confirmed last week, although sources indicated the terms of a sale for mid-June export were likely to be agreed soon.
Suppliers hope US contract prices (USCP) will increase by 1-2 cent/lb in July. Although the June USCP has not been settled yet, players believe it will roll over at 20 cent/lb.
Methanol: Markets appeared to he softening as offer prices slipped by about US$10/tonne for July arrival in SEA. Most offer prices were US$240/tonne cfr SEA for 5000-10 000-tonne cargoes, but at least one supplier was offering material at US$230/tonne cfr SEA. Buyers received offers for larger volumes for July delivery.
MTBE: Prices were still holding at US$258-265/tonne cfr SEA for June delivery. Markets were quiet with limited spot activity.
Petronas has switched to operating its PP/MTBE plant in a high MTBE output mode now that propylene and PP prices are deteriorating.
Ammonia: Prices appeared to have stopped falling, in line with expectations of tighter supplies from Yuznhyy as producers take maintenance turnarounds.
China Petrochemical Development Corp (CPDC) awarded its tender for July delivery of 20 000 tonne at US$184-185/tonne cfr Taiwan. This is close to the price of CPDC's last tender.
|Bulk chemical spot prices - US$/tonne|
|Asia/Pacific spot||US/Euro contracts|
|NE Asia1||SE Asia2||US3||NWE4|
|Naphtha||208-210 cfr Japan7||-||na||na|
|Ethylene||690-700 cfr Taiwan||730||0.265-0.27/Ib||1020|
|Propylene5||640-650 cfr Taiwan6||600||0.2075/Ib||875|
|Butadiene||385 cfr China6||300-305 fob Thailand||0.2/lb May||680|
|Methanol||280 cif Japan6||240-250||0.59-0.61/gal||344 fob|
|MTBE||277 cfr Taiwan6||258-265||0.79-1.18/gal May||na|
|Ammonia||184-185||189 cfr EC India||na||na|
|1 Prices are fob Korea unless otherwise
2 Prices are cfr SEA unless otherwise indicated
3 US prices are April contract levels on fob unless otherwise indicated
4 European FD Q2 contract price in DM/tonne, courtesy of ECN
5 Polymer grade
6 No recent business
7 Quote for first-half August delivery
MoPJ = Mean of Platt's Japan
na = not available
Prices contained in this report are obtained by the ACN team through consultation with producers, consumers and merchants in the regions indicated. They are a guide to price levels of recent business and reflect medium to large tonnage sales. Spot prices are quoted as indicated: cfr - cost and freight; fob - free on board; cif - cost, insurance and freight; FD - free delivered. Spot prices are based on information available mid-week prior to the date of issue. Dollar prices are based on prevailing rates of exchange.
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