FocusLow imports to keep India domestic toluene prices stable

05 October 2012 07:09  [Source: ICIS news]

By Jasmine Khoo

Low imports to keep India domestic toluene prices stableSINGAPORE (ICIS)--India’s domestic toluene prices are expected to be stable-to-firm for the rest of the month in spite of recent weakness, as lower-than-usual volume of imports has been keeping supply tight, market participants said on Friday.

Prices came off by Indian rupees (Rs) $4-5/kg ($77-97/tonne) from an all-time high of Rs 84-85/kg ex-tank hit 20 September as new shipments arrived at the ports of Kandla and Mumbai.

“The cargoes, which just came in, met the immediate needs of the end-users, which brought prices down,” said a buyer.

On Thursday, domestic toluene prices in India were quoted at around Rs79.00-81.00/kg ex-tank, but this might just be a slight reprieve as supply is “critically low” in the country, market sources said.

This month, around 8,000-10,000 tonnes of imported toluene are expected to arrive in India but the volume is deemed insufficient to bring inventory back to comfortable levels, market sources said.

“Port inventories are still very, very low. Most of the cargoes, which just came in, were snapped up immediately,” one of the buyers said.

India’s monthly toluene imports must be around 14,000-16,000 tonnes to cover domestic demand, market players said.

It had been taking in lower-than-normal volumes as the depreciation of the Indian rupee in July made imports more expensive.

“Importers are buying around 50% of what they usually buy,” a market source said.

In August and September, India only imported roughly half of the monthly requirement, at around 6,000-8,000 tonnes.

“Congestion at the ports and delays in shipments exacerbated the tight supply situation,” another market source said.

($1 = €0.77 / $1 = Rs51.75)

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections
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By: Jasmine Khoo
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