16 April 2007 00:00 [Source: ICB]
European naphtha was in a $652-660/tonne CIF NWE range last Thursday, up $4.00/tonne on the buy side of Wednesday's close as values were pulled up by firmer Brent crude prices.
Asia's naphtha prices slid last Thursday following weaker WTI crude. The second-half May contract is notionally quoted lower at $682-685/tonne CFR Japan.
European ethylene is firm but quiet. There were no deals reported, with talk centred around planned and unplanned outages. Total's unit went down at Gonfreville, France, last Wednesday and was expected to be out for a week, but Polimeri's Porto Torres, Italy, unit is up again after an unplanned shutdown. INEOS and Borealis are expected to be in planned shutdown this week.
Bids from Taiwan notionally held steady at $900-$930/tonne CFR amid thin trades, but talk of more cargoes available from Korea could dampen sentiment. LG Chem is producing on-spec ethylene at its newly-expanded naphtha cracker in Daesan, which is operating at 70% capacity.
European propylene prices are hovering at €870-895/tonne, with the latest deal completed at €895/tonne. Sellers are trying to move offers up to €900/tonne.
Asian propylene prices lack firm direction, with prices hovering at $1,080-1,100/tonne CFR NE Asia, unchanged from last week due to thin trade. The anticipated rise in supplies in the region in May from Korea and Taiwan has contributed to sluggish spot demand.
European butadiene (BD) spot prices are notionally unchanged at $1,240-1,270/tonne. There is some trader interest in exporting to the US. Contract discussions are ongoing (see box). Asian BD spot prices are notional at $940-960/tonne CFR NE Asia, amid thin buying interest.
Buyers remain on the sidelines in the hope of lower prices, given that supply exceeds demand. Spot offers of $950/tonne CFR NE Asia are eliciting a lukewarm response.
European benzene stands at $1,115-1,130/tonne with deals heard within this range. Prices were at $1,090-1,110/tonne at the start of the week.
Asian benzene prices for April to May loading parcels are notionally assessed at $1,060-1,070/tonne FOB Korea, up in line with firm US benzene and Asian toluene.
A May deep-sea shipping offer at $1,075/tonne met a bid at $1,060/tonne FOB Korea. A June cargo was transacted at $1,050/tonne FOB Korea, with two more deals rumoured.
European toluene is quiet, with no deals reported. Prices are unchanged from the end of the previous week at $865-880/tonne, but are being supported by firmer crude values.
Asian prices climbed higher with an offer for second-half May lifting heard at $858/tonne FOB Korea. A June loading parcel changed hands at $875/tonne FOB Korea. Another fixture was concluded at this level.
European mixed xylenes (MX) values are still at $870-900/tonne, with no deals done. There is very little action in the Asian MX market, with one deal heard at $960/tonne FOB Korea.
Paraxylene (PX) spot in Europe is quiet, although May's bids and offers, which are in a range of $1,100-1,130/tonne, are more numerous than April's, which fall between $1,100-1,125/tonne. Asian PX spot is rising steadily on the back of stronger demand and is pegged at $1,180-$1,190/tonne.
European orthoxylene (OX) prices are notional and unchanged at $1,000-1,040/tonne, but may see upward movement this week if crude remains firm.
OX in Asia is notionally assessed at $1,080-1,120/tonne CFR China Main Port (CMP) amid a quiet market. Few trades were heard as buyers purchased cargoes earlier and have little interest in the high offers.
European styrene prices have been following the upward movement in benzene, climbing to $1,310-1,325/tonne last Thursday from $1,290-1,310/tonne at the start of the week. No deals were heard.
Asian styrene remains on the uptrend, sustained by firm upstream benzene values. Deals for May cargoes were concluded at $1,270-1,285/tonne FOB Korea.
There were two European methanol deals last week at €190/tonne on Thursday and €195/tonne on Wednesday, as markets picked up after a quiet period. China's methanol prices dipped $10/tonne to $245-265/tonne CFR amid ample supply. There are rumblings of a lower-priced deal at $236-240/tonne CFR China, involving a 21,000-tonne Iranian parcel. Details or confirmation remain elusive. April-loading cargoes were largely concluded at $260/tonne CFR CMP.
Deals have finally been reported on the European MTBE market. Several trades took place within a $752-774/tonne range. Demand is steady and the market balanced. The factor to gasoline is at 1.09-1.10. Asian MTBE is stable and quiet at $680-700/tonne FOB Singapore. Deals are scarce due to supply and shipping constraints.
Provided demand in India remains steady, Asia can accommodate additional cargoes of FSU ammonia.
Weaker Yuzhny prices are prompting suppliers to ship to Asia. Yuzhny prices have fallen to $268-270/tonne FOB, with further reductions expected.
The Markets Trends page features prices compiled using information from our sister service ICIS pricing. Data for all Monitors are also based on information from ICIS pricing editors.
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PLAYERS PROCRASTINATE OVER Q2 BUTADIENE
European second-quarter butadiene (BD) contract negotiations are taking much longer than expected, with no settlement in sight.
Sellers are mostly targeting €900/tonne FD NWE and above for the second quarter (Q2). Buyers, on the other hand, are trying to avoid the €900/tonne psychological barrier and want to settle in the high €800s/tonne, having initially sought a rollover from the first quarter price of ¤870/tonne.
One producer says market conditions in the next three months are likely to be very different from Q1, which saw BD producers operating at full capacity and providing large volumes of high quality material.
The rising cost of feedstock naphtha will encourage producers to switch to cracking liquefied petroleum gas (LPG) instead, which would have a serious impact on the quantity and quality of BD available in Q2. On top of this, the turnaround season has already begun and demand for BD remains strong.
Prices for spot and export material have consistently been far above the contract price level in Q1. But buyers believe there is no reason for BD to be more expensive than ethylene and propylene, which were fixed at €890/tonne and €850/tonne respectively.
One buyer said that BD supply in Q2 would not be as tight as anticipated, due to smooth production in recent months and maintenance shutdowns on the buy side planned for June.
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