03 January 2012 04:52 [Source: ICIS news]
SINGAPORE (ICIS)--South Korea’s S-Oil has declared a price disagreement on its January paraxylene (PX) Asian Contract Price (ACP), a company source said on Tuesday.
The company source declined to specify how they would settle January contracts but said the settlement price will differ from customer to customer “depending on contracts”.
The latest move by S-Oil leaves the key pricing benchmark mechanism in limbo yet again as Japan’s JX Nippon Oil & Energy and Idemitsu Kosan have similarly abandoned talks after failing to come to a conclusion with its respective customers.
Only ExxonMobil settled its January PX ACP with most of its customers at $1,445/tonne (€1,113/tonne) CFR (cost & freight) Asia which players deem as a partial settlement of the benchmark ACP.
The industry at large typically benchmarks and settles contracts off a concluded price between two major PX makers, including ExxonMobil, JX Nippon Oil & Energy, Idemitsu Kosan and S-Oil and two major PX end-users, including Mitsubishi Chemical, Mitsui Chemical, BP, China American Petrochemical Co (CAPCO), Oriental Petrochemical (Taiwan) and Zhejiang Yisheng Petrochemical.
A price conclusion between two major PX makers and two major end-users is also deemed a major settlement by industry players.
Talks last broke down during negotiations for the October 2011 PX ACP when market players turned towards spot CFR Taiwan quotes for contract settlements.
($1 = €0.77)
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