28 November 2012 03:27 [Source: ICIS news]
SINGAPORE (ICIS)--Indonesia's Chandra Asri plans to further cut operating rates at its 600,000 tonne/year naphtha cracker at Cilegon in West Java to 90% in December, because of negative margins, a company official said on Wednesday.
The cracker is currently operating at 90-95% of capacity this month, down from close to a 100% run rate in October, the company official said.
“We hope there will be a rebound in ethylene spot prices but if prices remain flat or soft, then we have to review our cracker operating rates further because we can’t afford to lose more,” he added.
The company was previously eyeing to sell a 3,000-tonne ethylene cargo for loading in December at above $1,300/tonne FOB (free on board) southeast Asia basis, based on imported naphtha.
Ethylene spot prices were assessed at $1,170-1,230/tonne (€901-947/tonne) CFR (cost and freight) NE Asia in the week ended 23 November, down by $50-80/tonne from the previous week, according to ICIS.
Market sentiment turned bearish following the revival of shipments from Iran to China and softening prices in Europe.
Chandra Asri is the sole cracker operator in Indonesia. It also operates a high density polyethylene (HDPE)/linear low density PE (LLDPE) swing facility in Cilegon that has a production capacity of 200,000-225,000 tonnes/year.
($1 = €0.77)
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