GPCA ’10: Asia toluene supply to remain high in 2011

07 December 2010 11:19  [Source: ICIS news]

DUBAI (ICIS)--Asia is expected to remain in oversupply of toluene next year as aromatics plants in China ramp up domestic production, while deep-sea cargoes are expected to continue flowing into the region, a key trader from Petrochem Middle East said on Tuesday.

“Toluene [supply] will be long in Asia,” the trader said at the sidelines of the 5th Gulf Petrochemicals and Chemicals Association (GPCA) forum in Dubai. The three-day annual forum runs from 7–9 December.

This oversupply condition would likely keep toluene prices depressed in 2011, the trader said.

China is the largest importer of toluene in Asia, taking in 40,000-50,000 tonnes of the material on a monthly basis this year, industry sources said. The country had steadily grown its domestic aromatics capacity over the years, but demand had been lacklustre in 2010.

Notwithstanding the increase in domestic production, China may also see an influx of US material next year, the trader added.

Strong imports amid weak demand had kept toluene inventory levels in eastern China at 120,000–150,000 tonnes since March this year, market sources said.

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By: Mahua Chakravarty
+65 6780 4359

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