UpdateTaiwan’s Formosa uses LPG amid high naphtha prices

08 March 2011 06:52  [Source: ICIS news]

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SINGAPORE (ICIS)--Taiwan’s Formosa Petrochemical Corp (FPCC) has switched partially to using liquefied petroleum gas (LPG) as feedstock for its three crackers in Mailiao as naphtha prices soared above $1,000/tonne (€720/tonne), traders said on Tuesday.

Now the FPCC crackers were running 90% on naphtha and 10% on LPG, they added.

“Previously the feedstock was 100% on naphtha but naphtha prices are too high because of crude,” one trader said.

LPG is now a much cheaper feedstock than naphtha.

Naphtha cracker operators consider using LPG as feedstock when LPG prices are around 90-95% of naphtha values.

LPG prices were valued at $872.93-882.93/tonne on Tuesday midday, or around 88% of naphtha values, traders said.

Meanwhile, naphtha prices were $1001-1004/tonne CFR (cost and freight) Japan, holding above the $1,000 tonne mark amid robust global crude futures and the crisis in OPEC producer Libya, ICIS data showed.

Separately, FPCC had bought 100,000-150,000 tonnes of LPG for March and April, traders said.

The company, which buys at least 300,000 tonnes of spot naphtha every month, is now assessing the situation to see how much naphtha is required for second-half April delivery, they added.

FPCC last purchased 200,000 tonnes of spot naphtha for delivery into Mailiao in the first half of April, at a premium of $2/tonne to Japan quotes CFR (cost and freight).

(1 = €0.72)

For more on naphtha, visit ICIS chemical intelligence

By: Felicia Loo

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