US, EU benzene up on Thursday but East-West arbitrage still closed

06 January 2012 04:15  [Source: ICIS news]

SINGAPORE (ICIS)--Benzene prices in the US and Europe firmed late on Thursday, following hikes in Asian numbers, but it failed to re-open the closed arbitrage window from Asia to the US for January and February.

US benzene prices for January were hovering at $3.86-3.87/gal or $1,154-1,157/tonne (€900-902/tonne) FOB (free on board) Barges, $27-39/tonne higher than Asian values seen on Friday morning.

The arbitrage window from Asia to the US was still closed on paper, based on US benzene prices for January and February, although US prices have regained a lot of ground in recent weeks, said traders and brokers.

But the expected shipments from Asia to the US in January will be higher at about 40,000 tonnes, compared with the last two months, said a Japanese trader.

Some Asian players were already discussing the loading of March cargoes from Asia to the US, but it was hard to gauge the US arrival price level in May, said traders.

The freight rates for shipping 5,000 tonnes of benzene from South Korea to the US were hovering in the mid $50s-60/tonne, they added.

European benzene prices also rose on Thursday to $1,130-1,150/tonne CIF (cost, insurance and freight) ARA (Amsterdam, Rotterdam, Antwerp).

On Friday morning, spot benzene prices in Asia were $5/tonne lower than the previous day’s close at $1,115-1,130/tonne FOB (free on board) Korea, according to ICIS.

On Thursday, Asian prices spiked to a four-month high at $1,120-1,135/tonne FOB Korea on the back of increases in WTI crude futures to above $103/bbl.

($1 = €0.78)

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By: Mahua Chakravarty
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