UpdateAsia to receive 600,000 tonnes of deep-sea naphtha in Dec/Jan

22 November 2010 03:46  [Source: ICIS news]

(adds Honam deal, naphtha prices)

SINGAPORE (ICIS)--Asia is set to receive some 600,000 tonnes of deep-sea naphtha supply from Europe in December and January, as a recent run-up in prices helped to make arbitrage economics workable, traders said on Monday.

For December, the volumes were expected to be 450,000 tonnes, and the remainder would be for January arrivals, they added.

“The arbitrage cargoes will prevent the market from overheating,” said a trader in Singapore.

Last week, the European naphtha cargo market traded within a range of $760-790/tonne (€555-578/tonne) CIF (cost, insurance and freight) NWE (northwest Europe), versus $796-806/tonne CFR (cost and freight) Japan in Asia, ICIS data showed.

Demand from end-users remained strong in Asia, traders said.

South Korea’s Honam Petrochemical snapped up 100,000 tonnes of spot naphtha for delivery in the second half of December, at a premium of $6/tonne to Japan quotes CFR, they added.

The prompt first-half January naphtha crack spread versus January ICE Brent crude was assessed at $156.03/tonne on 19 December, up from $150.13/tonne on the previous week, ICIS data showed.

($1 = €0.73)

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By: Felicia Loo

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