25 November 2009 17:51 [Source: ICIS news]
AMSTERDAM (ICIS news)--Benzene availability and pricing will continue to be affected by developments in steam cracking and reformer operations, especially if refined product prices remain volatile, said ChemSystems' marketing manager, Alastair Hensman, on Wednesday.
“The feedstock [naphtha] price will be critical to aromatics fortunes in 2010,” he added at the 8th European Aromatics & Derivatives Conference in ?xml:namespace>
Production from steam crackers would be affected by switching between naphtha and LPG (liquefied petroleum gas) feedstocks as cracker operators struggle to maintain profitability by choosing the lowest priced feedstock, explained Hensman. The cracking of LPG, in particular propane, reduces the benzene yield.
“Persistent high naphtha values relative to propane will continue the trend towards lighter feedstock cracking and place upward pressure on benzene values to secure supply,” he added.
Hensman showed that historically, when propane prices fall, benzene prices move up to encourage the cracking of naphtha.
Investment in reformer-based production has been partly driven to increase the supply of paraxylene for the growing polyester sector. However, the polyester fibre sector faces competition from cotton when crude oil prices are high, placing downward pressure on paraxylene values, said Hensman.
He showed that up to 2004, paraxylene carried the largest share of reformer operating costs. Since 2005, gasoline and benzene have been shouldering a higher proportion of these costs.
However, he warned: “A weak gasoline market with strong naphtha [values] could add upwards pressure on benzene values.”
The 8th European Aromatics & Derivatives Conference, jointly organised by ICIS and International e-Chem, takes place from Wednesday 25 November to Thursday 26 November 2009.
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