Japan’s JX Nippon cuts Kawasaki naphtha cracker rate to 80-85%

27 October 2011 05:08  [Source: ICIS news]

SINGAPORE (ICIS)--Japan’s JX Nippon Oil & Energy has cut the operating rate at its 460,000 tonne/year naphtha cracker at Kawasaki to 80-85% early this month because of poor margins, a company source said on Thursday.

JX Nippon operated the cracker at around 95% of capacity in September, the source said.

“The market is very bad,” he added.  

The ethylene margin was assessed at $15.00/tonne (€10.80/tonne) in the week ended 21 October, according to ICIS.

In order for cracker operators to yield a profit, the minimum spread between ethylene and naphtha should be $250/tonne, traders said.

The margin had plunged because of falling downstream prices for key petrochemical products, they added.

JX Nippon plans to shut the naphtha cracker and olefins conversion unit (OCU) at Kawasaki for scheduled maintenance in 2012. The cracker is expected to be shut in mid-August for 45 days.

($1 = €0.72)

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By: Felicia Loo

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