09 April 2013 10:12 [Source: ICIS news]
LONDON (ICIS)--European benzene spot levels have seen some upward movement on improved sentiment for April, sources said on Tuesday, although activity remains thin.
While deals for April delivery hovered around the $1,250/tonne (€963/tonne) CIF (cost, insurance, freight) ARA (Amsterdam-Rotterdam-Antwerp) level last week, there was a rallying in the US market on Thursday 4 April despite global bearishness, amid renewed purchasing activity.
This continued the following day, with an estimated 80,000 - 100,000 barrels trading.
The outlook for Europe this month was predominantly bearish at the end of March, but by Friday 5 April the offer level had reached $1,300/tonne again, although buyers were initially reluctant to follow.
The upturn carried over into this week, with April offers opening at $1,300/tonne while bids were still pegged around the contract settlement level at $1,265/tonne. The range later narrowed, and there were deals done at $1,275/tonne and $1,282/tonne.
The bullishness continued on Tuesday morning, with April trading at $1,300/tonne already. The range was valued at $1,280-1,310/tonne CIF ARA.
The April Europe benzene contract was settled at a US dollar concept of $1,267/tonne FOB (free on board) NWE (northwest Europe), down $113/tonne from the previous month.
“The numbers have gone up in Asia and the US,” one European trader said. “There seems to be better sentiment for April. Prices have bottomed out now, and the Chinese are buying again.”
Nevertheless, the trader added the domestic market was still relatively quiet and thin, and said that it was seeing around 60-70% of the business it had done the same time last year.
“This is fairly typical across the market right now,” the trader said.
With benzene activity sparse amid the styrene turnarounds and wealth of imports into the ARA region, as well as slower phenol offtake owing to poorly performing coatings and construction sectors, any sign of positive data is pushing the market up.
“The market gets very sensitive when activity is thin,” said one source.
($1 = €0.77)
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