09 May 2013 09:31 [Source: ICIS news]
SINGAPORE (ICIS)--Taiwan’s Formosa Petrochemical Corp (FPCC) is expected to suspend spot supply of Group II base oils to China till November because of unit maintenance, a company source said on Thursday.
The company plans to shut its 600,000 tonne/year Group II base oils facility at Mailiao from late July to late September for a routine turnaround, the source said.
Therefore, the company has halted spot supplies to China since March this year, because of falling production during the two-month unit shutdown, the source explained.
The company also decided to reduce its monthly contractual supplies by half to about 10,000 tonnes to China in August-September, the source said.
China’s Group II base oils imports from Taiwan, which make up more than half of the country’s Group II imports, are expected to decline significantly in the second and third quarters, industry sources said.
However, prices of imported Group II base oils are likely to stabilise in China, as the second and third quarters are the traditional low consumption seasons in Asia, the sources said.
Meanwhile, South Korea-based SK Group is planning to start up a 300,000 tonne/year Group II base oils plant in June, which is expected to push up Group II supply in the Asian market, the sources added.
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