25 April 2008 09:42 [Source: ICIS news]
SINGAPORE (ICIS news)--Northeast Asian naphtha discounts have eased to $1-2/tonne over published quotes for second half of June cargoes due to strong buying interest from end-users this week, industry sources said on Friday.
Two South Korean cracker operators were said to have snapped up a total of 75,000 tonnes of open spec naptha at the above discount levels to CFR (cost and freight) Japan quotes.
Earlier, Lotte Daesan purchased a cargo of 50,000 tonnes of full range naphtha at $1.25/tonne to Japan quotes CFR Korea for delivery in the first half of June. This is equivalent to a discount of around $2.50/tonne to Japan quotes CFR Korea for June open spec naphtha cargoes.
This week’s largest purchase by Taiwan's Formosa Petrochemical (FPCC), of 200,000 tonnes of open spec naphtha, set the lowest discount for June cargoes, a source said.
"We are pleased that margins from ethylene are recovering this month and we may be buying more naphtha for June," another buyer said.
The inter-month backwardation spreads between the first half of June and first half of July had also widened from $1.50/tonne early this week to $2.50/tonne towards the end of the week.
Asian naphtha opened softer on Friday after hitting a record high of $982/tonne. First half of June indications were pegged at $967.75-970.75/tonne CFR Japan, second half of June at $966.50-969.50/tonne CFR Japan and first half of July at $965.25-968.25/tonne CFR Japan.
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