Naphtha still surging

30 August 1999 00:00  [Source: ACN]

Naphtha prices soar to nearly US$230

Naphtha: Prices surged well past the US$220/tonne cfr Japan barrier and were testing the US$230/tonne cfr Japan mark. Open-spec forward contracts for second-half October were concluded at US$229/ tonne cfr Japan. Prices were now deemed too high by some market players. They attributed the rapid rise to speculative activities by a few traders.

The strength in Asian markets has widened the Asia-Europe price spread to nearly US$25/tonne, enough to open up the arbitrage window. Two large cargoes totalling 140 000 tonne - one from Algeria and the other to be assembled from multiple European sources - are almost certain to arrive in Asia in October, said a source.

However, this is still deemed insufficient to relieve the severe prompt shortage in Asian markets, said most sources.

Ethylene: Prices continued to climb. A deal was believed to have been concluded at US$510/tonne cfr Taiwan for September delivery. The buyer was said to be an ethylene glycol producer. PE producers, however, were still unable to afford such a level with hdPE prices at US$620-640/tonne cif China. Honam Petrochemical said it shut down one of its three lines of PE production because feedstock was too expensive. In SEA, selling ideas were US$470-480/tonne fob SEA or US$510-520/tonne cfr SEA. Buyers were unwilling to pay above US$500/tonne cfr SEA.

Propylene: Buyers and sellers appeared to be still at a standoff. Offers were US$470- 480/tonne cfr SEA but buyers were indicating only US$440-450/tonne cfr SEA. With Chinese PP imports showing few signs of firming up, PP producers in SEA were continuing to run at reduced operating rates, said a Japanese trader.

The only buying activity seemed to be from China for domestic PP production. Prices were discussed at US$430-440/tonne cfr China for September cargoes.

Butadiene: Prices were still on the rise. A Thai producer said supplies for September were sold at US$340-350/tonne fob Thai-land, which would equate to US$390- 400/tonne cfr Taiwan.

Previous deals were at US$300/tonne fob Thailand and US$360/tonne cfr Taiwan. The buyer was a trader likely to ship the Thai cargo to Taiwan.

A few US producers were said to have announced a September contract price of 17 cent/lb, 1 cent/lb higher than the August contract price.

Methanol: The 800 000 tonne/year new plant in Qatar has loaded its first cargo which is bound for India.

The new capacity is expected to dampen prices in September, but traders said August prices were steady at US$120-130/tonne cfr SEA and US$115-120/tonne cfr China.

MTBE: A prompt September requirement from Thailand has emerged, said traders, but there were no reports of deals. Production problems at MTBE Malaysia were believed to be still unresolved. The company could not be reached for comment. Prices were hardly changed at US$265-270/tonne cfr SEA, said traders.

Ammonia: Samsung Fine Chemicals awarded an import tender for a 35 000-tonne cargo for mid-October arrival at US$139.8/tonne cfr Korea. China Petro-chemical Development Corp (CPDC), however, has yet to award an import tender for the same timing. CPDC was holding final price discussions in the US$140s/tonne cfr Taiwan with two selected tender participants as ACN went to press.

Bulk chemical spot prices - US$/tonne

Asia/Pacific spot

US/Euro contracts

NE Asia1

SE Asia2

US3

NWE4

Naphtha

229 cfr Japan

-

na

na

Ethylene

510 cfr Taiwan

450

22.5-23.0 July

435-450

Propylene5

420 cfr China

440

14.5 July

320

Butadiene

390-400 cfr Taiwan

340-350 fob Thailand

17

278

Methanol

115-120 cfr NEA

120-130

na

110 fob

MTBE

260-265 cfr Taiwan6

260-270

na

na

Ammonia

139.8 cfr Korea

143 cfr India EC

na

na

¹ prices are fob Korea unless otherwise indicated

² prices are cfr SEA unless otherwise indicated

³ US prices are August contract levels in cent/lb on an fob basis unless otherwise indicated, courtesy of ECN

⁴ European FD Q3 contract price in Euro/tonne, courtesy of ECN

⁵ polymer grade

⁶ No recent confirmed business

na = not available

MoPJ = Mean of Platt's Japan

MoPS = Mean of Platt's Singapore

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.

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly