23 August 2012 14:40 [Source: ICIS news]
LONDON (ICIS)-European spot prices rose this week, supported by firm crude values and positive market sentiment for demand in September, market sources said on Thursday.
Firmer crude lifted spot prices and while few deals were reported for August, September was actively traded with over 10,000 tonnes of benzene changing hands at $1,255-1,265/tonne (€1,004-1,012/tonne) in the early part of this week.
The deals were done on a CIF (cost, insurance, freight) ARA (Amsterdam- Rotterdam-Antwerp) basis.
August spot benzene traded at $1,290-1,300/tonne CIF ARA.
Comparing the August Benzene spot range with the August contract price, the August trades average at €1,036/tonne, which is €25/tonne below the contract price of €1,061/tonne FOB (free on board), NWE (northwest Europe).
The September contract price is expected to settle on Friday 31 August.
“Many people are expecting better demand to come in September and the spread with naphtha is not that high anymore,” said an aromatics producer.
“The tightness has eased away and there are no more first-half premiums,” the producer added.
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Regarding September, a second producer said it expected to see a better month in terms of demand.
“Everybody anticipated a weak September and although I am not overly bullish, I don’t think the market is getting too long despite production problems being solved,” he said.
“Styrene is a bit firmer and the arb [arbitrage] is not working because people are keeping it closed. August prices are up and won’t come down and September is up a notch and quite consistent," the producer added.
In the morning, August spot benzene was bid at $1,300/tonne CIF ARA, but this was not met with any corresponding offers. September was valued in a $1,275-1,285/tonne price range.In the afternoon, spot benzene prices continued to firm, spurred on by a flurry of buying activity recorded in the styrene market by a styrene producer. August benzene was valued at $1,325-1,350/tonne. September was heavily backwardated at $1,265-1,285/tonne.
($1 = €0.80)
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