Asia IX, PX fall on weaker crude futures as Formosa faces shutdowns

02 August 2011 12:32  [Source: ICIS news]

SINGAPORE (ICIS)--Asia isomer-grade xylene (IX) and paraxylene (PX) prices fell by $5–10/tonne (€4–7/tonne) on Tuesday amid weaker crude futures, market sources said, but traders were watching for further developments after Formosa Petrochemical Corp (FPCC) declared a force majeure on all petroleum products from its complex in Mailiao, Taiwan.

IX prices were hovering at $1,345–1,360/tonne FOB (free on board) Korea, $10/tonne lower than Monday, according to data from ICIS. Prices of PX, meanwhile, were assessed at $1,625–1,630/tonne CFR (cost & freight) Taiwan and/or China Main Port (CMP), $5–10/tonne lower than the previous day.

Officials from Formosa Chemicals and Fibre Corp (FCFC) told ICIS it remained unclear which Mailiao-based units would be shut as discussions with the Taiwanese government were ongoing.

The local government had ordered a “rotational closure” of the entire Mailiao refinery and petrochemical complex on 1 August for a thorough review of safety standards, following a string of fire accidents at the site.

This had sparked fears that FCFC would be unable to produce sufficient amounts of PX to feed its purified terephthalic acid (PTA) capacities in Taiwan. Prices of PTA jumped by $53–55/tonne from 29 July to $1,245–1,275/tonne CFR CMP.

FCFC produces a total of 1.72m tonnes/year of PX to feed its PTA-producing facilities, which have a combined nameplate capacity of nearly 2.9m tonnes/year.

The shutdown of FPCC’s 540,000 bbl/day Mailiao refinery had also caused concerns over whether FCFC would receive sufficient amounts of feedstock naphtha and reformate to maintain aromatics production.

“We will know exactly which units will need to be shut over the next few days and we will remedy the issue from there,” said an official from FCFC.

($1 = €0.70)

For more on IX and PX, visit ICIS chemical intelligence

By: Bohan Loh
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