02 April 2009 11:01 [Source: ICIS news]
SINGAPORE (ICIS news)--?xml:namespace>
“Suppliers such as Sinopec had cut operating rates to about 60%, resulting in a cut in China’s domestic supply,” a Singapore-based trader said.
Benzene imports in February were up by 18% month on month to 123,343 tonnes, according to statistics released by China Customs this week.
Imports of propylene grew by 28% month on month to 139,250 tonnes, paraxylene was up 40% to 337,679 tonnes and monoethylene glycol increased by 40% to 501,846 tonnes.
“One of the other reasons [for higher imports] could also be because of high production cost locally,” said Ardern Dai, an analyst with petrochemical research firm Frost & Sullivan, in Mandarin.
“The producers found the market prices for products, such as methanol, to be lower than their production costs and therefore found it more feasible to buy them from abroad,” Dai said.
Methanol imports in February grew by 187,815 tonnes to 591,221 tonnes from January, while styrene monomer imports jumped 40% to 337,679 tonnes.
Some producers said the rise in imports was partly due to the Lunar New Year falling in January, a time when domestic production declines because of extended holidays.
“This year, Lunar New Year fell in January, unlike last year, and therefore it is normal to see an increase in the imports statistics for February as it is the month that companies started operations,” one producer said.
“The demand will not be recovering so soon even though domestic prices are seen to be picking up,” Dai said.
“It is common to see a rebound in the prices for products, just like stocks.”
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