30 April 2007 00:00 [Source: ICB]
Open-spec naphtha cargoes are up on the previous week to $663-666/tonne CIF NWE, with May swaps pegged at $657-658/tonne. June Brent is $68.20/bbl.
Asia's prices, meanwhile, have dipped to $678-681/tonne CFR Japan levels for the first half of June. The spot market has come under some downward pressure from higher Indian naphtha exports and arbitrage arrivals from Europe and the Mediterranean.
The ethylene market continues to be affected by the cracker shutdown slate in Europe, but everything appears to be going smoothly. Dow's cracker in Germany is the latest to start coming back from planned maintenance. There are, however, still reports of issues at Total's Gonfreville plant in France. The current range is unchanged at $1,220-1,270/tonne. No trades have been reported since a €960/tonne deal the previous week.
Asian prices are notionally firmer in the $950-970/tonne CFR northeast Asia range, up by $45/tonne from the previous week. This reflects production problems at some regional crackers, which have led to fewer spot volumes in the market.
No business has been concluded in Europe's propylene market since the €900/tonne deal for polymer grade material on 20 April. The current range is pegged at €870-900/tonne. Asian prices are $1,090-1,120/tonne CFR NE Asia in a market fuelled by buy-sell resistance because of the Labour Day holidays in May.
There is minimal buying interest in the European butadiene (BD) market, and little excess material because of the numerous shutdowns. Spot numbers are up, but extremely notional, at $1,260-1,290/tonne. No trades are reported.
In Asia, butadiene prices have risen to $970-990/tonne CFR NE Asia. Interest is thin for spot offers of $1,000/tonne CFR NE Asia for May shipments, with customers saying they have covered May requirements and are under no pressure to secure spot cargoes. Extra supply from Formosa Petrochemical Corporation (FPC), with a new plant due to come on stream in June, has dampened buying sentiment (see page 28).
The opening of the arbitrage to the US on the previous Friday raised buying interest for benzene in Europe, and boosted prices. Higher crude was also behind the rises. Prices on Monday were around $1,225/tonne but dipped to $1,180-1,190/tonne by Thursday.
Asian benzene values have risen in line with stronger US benzene. Prices moved as high as $1,145-1,155/tonne FOB Korea on Tuesday, as traders sought to cover short positions, but were notionally down to $1,120-1,130/tonne by midweek.
European toluene is subdued, with no trades heard. Rising energy values have notionally pushed spot values up to $905-940/tonne from Monday's $870-890/tonne. Asian prices are up at $855-890/tonne FOB Korea, with a deal heard at $890/tonne for June shipment.
Mixed xylene activity is non-existent in Europe. Prices are notional at $925-935/tonne. In Asia, isomer grade xylene prices have surged, with a deal at $1,050/tonne FOB Korea for second-half-of-May shipment, $40/tonne higher than the deal reported earlier in the week. The range is $1,030-1,050/tonne.
Orthoxylene (OX) is also quiet, with most attention being turned to May contract discussions. Prices are unchanged at $1,000-1,050/tonne. Supply is extremely stretched. Asia's OX market was largely quiet last week ahead of the May Labour Day holidays in China. The range is $1,100-1,120/tonne CFR NE Asia. A deal was rumoured at $1,120-1,130/tonne CFR China Main Port.
Europe's illiquid styrene market has seen few trades over the past week. Spot numbers have followed benzene, and are reported at $1,395-1,420/tonne. Asian prices are in a $1,305-1,310/tonne FOB Korea range, bolstered by rising crude and benzene values early in the week. Deals for June shipment were largely at $1,305-1,310/tonne, with one cargo priced as high as $1,345/tonne.
Plentiful supply in Europe is keeping methanol spot prices low at €175-190/tonne. No deals have been done. An unplanned outage in Iran on 10 April and a planned turnaround in Serbia is likely to affect pricing. Asian values are heard in a $230-240/tonne CFR China range. Activity is still muted after falling sharply in recent weeks.
European MTBE trades ranged from $800-829/tonne last week. At the time of going to press, numbers were reported in a wide $815-855/tonne range, up on gasoline and strong demand because of the driving season. The factor to gasoline is 1.10.
High gasoline prices, good blending demand and the higher European prices have pulled Asian values up to $730-750/tonne FOB Singapore.
The fall in Yuzhny FOB ammonia is certainly casting a weak tone on ammonia prices in Asia. Middle East FOB prices have fallen to $300-307/tonne, with the netback from a contract cargo possibly dipping into the $290s/tonne. In Yuzhny, some tonnage is reported to have been purchased for end-April/early May at $260-265/tonne. Traders are believed to have bid at $250/tonne or below for additional May tonnes.
Asian paraxylene (PX) spot numbers have rocketed over the past week, marking their most significant increases this year, and taking them to their highest levels since October 2006.
An extremely bullish market has seen prices soar to $1,250-1,300/tonne, $60/tonne higher than the $1,210-1,220/tonne range reported a week earlier.
Traders say that firming prices in derivative markets, strong demand and high crude oil and naphtha values are behind the upturn.
By mid-week, deals had been done at $1,290/tonne and $1,310/tonne CFR NE Asia for June and May loading respectively.
Downstream, purified terephthalic acid (PTA) demand is strong, and prices have surged since mid-March, climbing to $930-940/tonne CFR China from $845-850/tonne levels.
"The whole chain, from polyester to PTA to PX, is doing very well, and everybody was making profits," says a PX trader. "That had boosted sentiment in the past few weeks."
Many expect PX consumption to stay decent through May, and possibly into June. However, much depends on whether the polyester sector stays strong.
In Europe, PX values have edged up over the course of the week because of the high crude. Numbers were pegged at $1,200-1,240/tonne on Thursday, up from $1,180-1,200/tonne levels on Monday. The market is quiet, with players awaiting the outcome of the contract settlement. No deals have been reported.
The Markets Trends & Data pages features prices compiled using information from our sister service ICIS pricing. Data for all Monitors are also based on information from ICIS pricing.
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