01 August 2013 06:06 [Source: ICIS news]
SINGAPORE (ICIS)--South Korea’s Hyundai Cosmo (HC) Petrochemical has cut production at its 800,000 tonne/year No 2 paraxylene (PX) unit in Daesan on Thursday, a company source said.
The company is now running the plant at 85-90% of capacity from 100% previously because of a weak price spread between feedstock mixed xylenes and PX, the source said.
“Run rates have been cut because of weak economics and the spread margins stands [at] less than $200/tonne,” the source said.
On 31 July, isomer-grade xylene prices stood at $1,278-1,285/tonne (€959-964/tonne) CFR (cost & freight) NE (northeast) Asia, while PX prices were at $1,474-1,479/tonne CFR Taiwan and/or China Main Port, according to ICIS data.
The price difference is currently at $194-196/tonne, against the ideal spread range of $250-300/tonne, according to market sources.
“HC Petrochemical will maintain … such [reduced] operating rates until the margin improves. If not, we will cut [production some] more,” the source said.
As a result of the cut back on operating rates, some of HC Petrochemical’s contractual volumes need to be adjusted, delayed, or skipped, according to the source.
PX production loss is estimated at more than 10,000 tonnes, the source said.
($1 = €0.75)
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