Market Trends: Renewed exports pull up PX prices

20 October 2003 00:00  [Source: ICB]

Paraxylene numbers rose to $560-570/tonne fob on the back of confidence in export activity and better prices in Asia. Many players feel this price surge is not sustainable

Naphtha prices are placed at $282-288/tonne cif NWE. Numbers were even higher in the early part of the week, reaching $292/tonne cif NWE. Prices are being pulled up by firmer crude oil numbers as markets continue to react to Opec's decision to cutback output and from inventory data emerging from the US.

Ethylene numbers have drifted up to $610-630/tonne cif NWE. Spot business has been concluded at the top end of the quoted range. A cracker operator experiencing production difficulties in France is believed to be in the market.

Propylene spot prices continues to slip, with numbers down to E370/tonne cif NWE for chemical grade material and polymer grade now in the range of E380-390/tonne cif NWE.

Barges are now flowing freely along the Rhine, with players focusing on managing their balances and bringing greater stability to the market after recent upheavals. Initial Q4 propylene contracts have been settled at E425/tonne FD, a dip of E5/tonne on Q3. Certain players are disappointed with the agreement (see page 10)

Butadiene spot numbers have firmed to $520-530/tonne fob NWE as availability has decreased, with producers complaining they have no spare material. Requirements from Asia and the US are heard in the market, but spot molecules are difficult to source. Q4 contracts have been inked at a roll-over of E520/tonne FD (see page 10).

Benzene has been reasonably active in spot terms, with a number of deals concluded in the $445-450/tonne fob NWE range, mainly for November material. Price levels are being supported by crude and the number of buyers in the market.

Toluene spot numbers have firmed on last week, with numbers heard at $410-417/tonne fob NWE. Offers are now at $420/tonne.

Xylenes prices remain stable, aided by crude oil markets and rising prices in the US. Players assess the market at $445-455/tonne fob NWE. In the distribution market, prompt material is being offered in the E430-440/tonne FCA range.

Paraxylene prices have risen, with inter-trade business concluded at $560-570/tonne fob NWE for October. Higher numbers are being offered for November and December cargoes. Anticipation of price increases in Asia, and renewed opportunity for export from Europe, is pulling prices up.

However, others counter that the price strength is not supported by demand/supply fundamentals in Europe, making a sustained increase unlikely.

Orthoxylene producers have yet to settle a Q4 contract figure. Contract discussion still appear focused on a minimal increase on the Q3 figure. It is suggested that consumers in need of product and will step into the market swiftly once the contract is settled. However, demand generally is not expected to be very high in Q4.

Styrene spot numbers remain around the $690-710/tonne fob level, with prices buoyed by strong benzene and increased activity in Asia. But downstream PS demand is still lacklustre. Activity is low and availability comfortable to tight. The initial Q4 settlement of E655-680/tonne looks as if it will be accepted in the market, although some buyers maintain the E72/tonne increase is too much. There is still uncertainty in the market regarding the PO/SM unit startup in Rotterdam, Belgium.

Methanol spot activity is subdued as most players are covered under contract. Levels are nominally steady at E176-180/tonne fob. The initial Q4 level of E190/tonne looks to be finding favour with buyers.

MTBE prices are drifting down with producers reporting deals in the $335-345/tonne fob NWE range for 2H October loading. The factor to gasoline is around 1.15, which may stimulate welcome end-use and blending demand in Europe, as opportunities for export to the US close down.

Ammonia spot business out of Yuzhnyy has softened very slightly to $205-208/tonne fob, but there is still demand for virtually all product coming through the port. Asia, the Mediterranean and US are all taking material at present. There is also active buying in NWE.

Bulk chemical prices

	European spot E/tonne	$/tonne	Change on last week	European contract E/tonne	$/tonne	US contract $/tonne
Naphtha	na	282-288 (cif)	+12	na	na	na
Ethylene	na	610-630 (cif)	+10	445 (Q3)	516	622 (Aug)
Propylene@	380-390 (cif) (nom)	na	-15	425 (Q4)+	497	473 (Sept)
Butadiene	na	520-530 (fob) (nom)	+5	520 (Q4)+	608	639 (Oct)
Benzene	na	445-450 (fob)	-1.5	375 (Q4)+/375 (Oct)	430/430	343(Oct)
Toluene*	na	410-417 (fob) (nom)	+18.5	333 (Q4)+	392	na
Xylenes	na	445-455 (fob)	+2.5	na	na	390 (Oct)
Paraxylene	na	560-570 (fob)	+35	522 (Oct)+	609	639 (Sept)
Orthoxylene	na	480-500 (cif) (nom)	nc	418 (Q3)	485	540 (Sept)
Styrenea	na	690-710 (fob)	nc	665-680 (Q4)	778-796	890 (Aug)
Methanol	176-180 (fob) (nom)	na	nc	190 (Q4)+	221	193 (Oct)
MTBE	na	335-345 (fob)	-12.5	na	na	na
Ammonia	na	240-245 (CFR)	nc	na	na	245 (CFR) (1H Oct)
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 15 October 2003.  Dollar prices are based on rates of exchange on 14 October 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=E0.855; $1=£0.600; E1=£0.702.

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