Corrected: Asia benzene falls on weaker market fundamentals, crude

12 August 2009 13:44  [Source: ICIS news]

Correction: In the ICIS news story headlined "Asia benzene falls on weaker market fundamentals, crude" dated 12 August 2009, please read the recasted lead, taking out the reference to overnight trading and actual price movement in US benzene. A corrected story follows.

SINGAPORE (ICIS news)--Asian benzene values have fallen $55/tonne (€39/tonne) on Wednesday, tracking losses in the key US market due to weak market fundamentals, buyers and sellers said.

Crude oil futures dipped below $70/bbl for the first time in a week during overnight trading, which exerted downward pressure on the benzene market to place Wednesday's range at $830-840/tonne FOB Korea, according to traders and producers.

Benzene prices have plummeted by $85/tonne within less than a week, down from last week's high of $915-925/tonne FOB Korea. 

Weaker market fundamentals and decreases in the overnight US benzene market for forward months have resulted in a widening of the bid/offer gap for September-loading cargoes of benzene.

Offers for lifting parcels for the second half of September were heard at $850/tonne FOB Korea, which were countered by bids at $810-815/tonne FOB Korea.

In addition, a deal was confirmed by a South Korean producer for October-lifting parcels at $825/tonne FOB Korea, according to global chemical market intelligence service ICIS pricing.

Lower bids for benzene were heard on 11 August at $895/tonne FOB Korea, down from deals on 7 August at $905/tonne FOB Korea and $915/tonne FOB Korea for September-loading cargoes.

Supply in the region was ample, while demand from the key downstream styrene monomer (SM) segment was weakening, traders and producers said.

Several Japanese and South Korean producers said they had opted to export additional product to the more lucrative US market.

Chinese suppliers were also thought to be mulling similar moves, despite the country being a net importer, according to sources.

Against this backdrop, it was no surprise that prices of Asian benzene have fallen in tandem with the US market for the forward months, a major South Korean producer said.

($1 = €0.71)

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By: Ong Sheau Ling
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