Players confirm August toluene settles $130/t down

05 August 2008 16:23  [Source: ICIS news]

LONDON (ICIS news)--European August toluene contracts have been settled down $130/tonne (€83/tonne) at $1,090-1,100/tonne over the last few days on falling energy complex and spot values, buyers and sellers said on Tuesday.

 

The figures represent a decrease from July’s record high of $1,220-1,230/tonne FOB (free on board) Rotterdam.

 

Despite this, one of the buyers who confirmed agreeing a figure between $1,090-1,100/tonne, still considered it to be “a bit high”.

 

“Current hydrodealkylation (HDA) margins are keeping the market higher but gasoline is still falling,” the customer added.

 

Market sources spoke recently of the upturn in demand for the production of benzene via HDA.

 

Benzene can be produced via the HDA route when values are at a sufficiently large differential to toluene.

 

The August benzene bid/offer spot range was pegged at $1,310-1,340/tonne CIF (cost, insurance, freight) ARA (Amsterdam, Rotterdam, Antwerp), according to global chemical market intelligence ICIS pricing.

 

Sentiment among buyers and sellers, meanwhile, placed spot toluene anywhere between $980-1,080/tonne FOB Rotterdam, down $55-120/tonne from Friday’s close of business.

 

Prices in the energy complex were losing ground, with gasoline falling $40/tonne on Monday to dip below $1,000/tonne FOB AR (Amsterdam, Rotterdam) for the first time since May. Gasoline traded as low as $992/tonne on Tuesday early afternoon. 

 

Market participants said on Monday the fall in gasoline values was a direct result of the drop in crude prices. September Brent on London’s ICE Futures traded at $116.91/bbl on Tuesday morning, rising to $119.75/bbl at press time.

 

Initial reports of contractual toluene agreements between $1,090-1,100/tonne were reported at the end of July. Other partners had decided to postpone their settlements until this week due to uncertainty regarding price direction.

 

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By: Caroline Howard
+44 20 8652 3214

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