Market trends: Benzene moves up on higher crude

29 September 2003 00:00  [Source: ICB]

Benzene spot markets were strengthened by improved Brent crude and US numbers. MTBE prices dropped swiftly with deals for October shipment concluded at $350-355/tonne

European naphtha prices have slipped to $240-242/tonne cif NWE, having tracked the trend in crude oil prices. Activity is described as thin, despite crackers running at higher operating rates.

Ethylene prices have firmed to $605-615/tonne as producers seeking prompt material have paid prices above $605/tonne. South American product is quoted sold within the range. Middle East material was offered at around $610/tonne cif NWE, although it seems that deals were not concluded. Markets are described as balanced to tight despite the majority of crackers running well, although two/three units in Germany are said to be running at reduced capacities.

Propylene numbers have drifted down to E395-415/ tonne cif NWE. Material is becoming available as a number of derivative units undergo scheduled and unscheduled outages. Polypropylene, oxo-alcohol and ACN units will continue to be out or run slower in the coming weeks. Players seeking to place deepsea cargoes are said to be contributing to the downward pressure on prices.

Butadiene prices are unchanged at $510-530/tonne fob NWE. Numbers remain largely notional with no new spot deals being reported. US contract prices have rolled over for September at 29 cent/lb.

Benzene spot markets started the week stronger backed by improved Brent crude numbers and stronger US spot values. By midweek business had been done at $420-440/tonne fob NWE for October. Players are assessing the outlook for the European market and the recent price movements as they approach negotiations for quarter four (Q4) contracts (see page 10).

No spot business has been reported for toluene in NWE and numbers have weakened to a notional range of $370-390/tonne fob for October due to lack of purchasing interest and lower energy values.

Xylenes prices are down, influenced by a fall in US numbers. Players talk of discussions at $460-470/tonne fob NWE with demand and supply reasonably balanced in Europe.

Paraxylene prices in Europe followed a run up in Asian numbers, but the range reflects trade discussions rather than deals. Offers are reported at $555/tonne with bids at around $525/tonne. The September contract price was reluctantly accepted by buyers at E585/tonne only at the month end.

Orthoxylene spot and contract prices are nominal with Europe's major buyer out of the market owing to the Rhine transportation problems. Q4 contract discussions are likely to begin only at the start of October.

Styrene markets continue to be calm with only a few enquiries reported. These are said to be largely driven by the need to test availability and numbers. No confirmed deals had followed these enquiries by midweek. Slower demand in the US is prompting exports from that area to both Europe and Asia, although most of the product coming into NWE is said to be committed. Numbers are understood to be in the $630-650/ tonne fob NWE range but are largely notional.

MTBE prices dropped swiftly with deals for October shipment concluded at $350-355/tonne. This range may hold briefly while arbitrage with the US remains an option, although buyers are already bidding at $340/tonne as tightness in the European market dissipates. The factor to gasoline is down to 1.35-1.36 approaching a workable level for blending.

Methanol spot business is quiet except in the Rhine area, where demand for prompt deliveries of small parcels is soaring. There is no change reported in Rotterdam spot values while players are still discussing Q4 contracts. One player mentioned concluding rail tank business for October at around E200/tonne.

Ammonia spot markets were quiet last week with numbers remaining at around $200/ tonne fob Yuzhnyy for October. Pricing is seen remaining stable in the Black Sea area while producers are trying to achieve a Tampa price of $245/tonne CFR for the second half of September.

Bulk chemical prices

	European spot E/tonne	$/tonne	Change on last week	European contract E/tonne	$/tonne	US contract $/tonne
Naphtha	na	240-242 (cif)	-3	na	na	na
Ethylene	na	605-615 (cif)	+17.5	445 (Q3)	516	622 (Aug)
Propylene @	395-415 (cif)	na	-12.5	430 (Q3)	499	473 (Sept)
Butadiene	na	510-530 (fob) (nom)	nc	520 (Q3)	603	639 (Sept)
Benzene	na	420-440 (fob)	+17.5	316 (Q3)/420 (Sept)	363/402	478 (Sept)
Toluene*	na	370-390 (fob) (nom)	-35	288 (Q3)	326	na
Xylenes	na	460-470 (fob)	-40	na	na	348 (Sep)
Paraxylene	na	525-555 (fob)	+35	585 (Sept)	586	639 (Sep)
Orthoxylene	na	500-530 (cif) (nom)	nc	418 (Q3)	485	540 (Sept)
Styrene a	na	630-650 (fob) (nom)	-15.5	583-608(Q3)	660-688	890 (Aug)
Methanol	176-180 (fob) (nom)	na	nc	225 (Q3)	259	255 (Sep)
MTBE	na	350-355 (fob)	-60	na	na	na
Ammonia	na	230-240 (CFR) (nom)	nc	na	na	234 (CFR) (1H Sept)
NOTES *TDI grade; @ Indicates polymer grade ; a Lower figure for barge price, higher figure for free delivery inland; +Initial contract settlement

Abbreviations and currency notes

Prices contained in this magazine are obtained by ECN through consultation with producers,consumers and merchants across Europe. They are intended as a guide to price levels of recent business in Europe and reflect medium to large tonnage sales.  Spot prices are quoted fob (free-on-board) NW European port, cif (cost, insurance and freight), FCA (free carrier), CFR (cost and freight). T2 = EC material, not dutiable, bld = blending grade, com = commercial grade, nit = nitration grade. European contract prices are quoted on a free delivered basis (FD) unless otherwise stated; initial but unfixed negotiating range is indicated (nom), na = not applicable, m = monthly contracts. Methanol T1 will no longer be quoted, as it now represents negligible spot business.  Spot prices in this issue are based on information available on 24 September 2003.  Dollar prices are based on rates of exchange on 23 September 2003. The dollar equivalent range is based on exchange rates prevalent at the time of contract closure if available, or an average rate for the quarter. $1=E0.871; $1=£0.605; E1=£0.695.

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