15 March 2011 07:25 [Source: ICIS news]
(Clarifies 11th paragraph, that in 2010 the largest volume of paraxylene (PX) exported by Japan went to China and that this was 30% of China's overall PX imports)
By Bohan Loh and ?xml:namespace>
SINGAPORE (ICIS)--Spot paraxylene prices in Asia may continue to rise as end-users in the purified terephthalic acid (PTA) sector scramble to secure cargoes following a supply force majeure declared by JX Nippon Oil & Energy, the world’s largest PX exporter, industry sources said on Tuesday.
Bids for April deliveries were up $10-15/tonne (€7.2-10.8/tonne) to $1,780/tonne CFR (cost and freight)
An end-user was heard to have snapped up a parcel at $1,800/tonne CFR Taiwan and/or CMP, but this could not be confirmed at the time of writing.
Meanwhile, a key northeast Asian end-user said it is looking for at least 25,000 tonnes of material for April delivery to cover the shortfall in deliveries from JX Nippon Oil.
PX climbed to its highest level on record at $1,770/tonne CFR Taiwan and/or CMP on Monday as the market anticipated the supply disruption.
JX Nippon Oil declared a force majeure on supply late on Monday due to shutdowns at three of its PX facilities - with a combined nameplate capacity of 950,000 tonnes/year - located near the earthquake-ravaged Miyagi prefecture.
Contract allocations would be cut by at least 50%, based on JX Nippon Oil’s notice to customers, as its 180,000 tonne/year and 420,000 tonne/year PX units in Kashima, as well as its 350,000 tonne/year plant in Kawasaki, has been shut since Friday in the wake of the Japan’s killer quake and tsunami.
Production was effectively cut by about 37%, based on JX Nippon Oil’s total capacity of 2.57m tonnes/year. (please see table below) The bulk of the company’s PX production is being exported.
JX Nippon Oil accounts for about two-thirds of
Based on separate checks with PX producers in
Most PX goes into producing PTA – a raw material used in the manufacture of textiles.
Meanwhile, the quake and tsunami-related shutdowns of five refineries in
“Short-term disruption to PX production and shipments can spark very sharp increases in spot prices, which are at already high levels,” he said.
Additional reporting by Nurluqman Suratman
($1 = €0.72)
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