28 February 2013 06:49 [Source: ICIS news]
SINGAPORE (ICIS)--Taiwan’s Formosa Petrochemical Corp (FPCC) will halt spot supplies of Group II base oils to China in March in view of falling production, a company source said on Thursday.
The company has reduced the operating rate of its 600,000 tonne/year Group II base oils plant at Mailiao in Taiwan as margins in the production of gasoline and gasoil are higher, the source explained.
FPCC will supply 35,000 tonnes of contractual cargoes to China next month, the source added.
Group II base oils supply is expected to tighten in March in Asia as two major suppliers in South Korea, GS-Caltex and S-Oil, plan to shut or reduce operations at their base oils units, industry sources said.
Therefore, Group II prices are likely to increase in Asia amid the consumption peak of March-April, added the sources.
FPCC supplied a total of 35,000 tonnes of Group II base oils to China in February, including 20,000 tonnes of spot cargoes.
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