05 August 2013 09:51 [Source: ICIS news]
LONDON (ICIS)--Some upward movement on European mixed xylenes (MX) pricing is expected in August, sources said on Monday, as a spread with downstream paraxylene (PX) has emerged.
MX spot pricing is currently holding around the $1,190/tonne (€893/tonne) level on a FOB (free on board) Rotterdam basis, while PX is now closer to $1,400/tonne following gains made in the Asian spot market last week.
“The spread with PX could drive European MX demand this month,” said one aromatics trader. “It is looking healthier, and the market seems to be moving towards better times.”
A rallying in downstream purified terephthalic acid (PTA) prices in Asia has resulted in higher feedstock PX spot prices across the region last week, with numbers moving as high as $1,513/tonne CFR (cost and freight) amid talk of two suppliers cutting back production as a result of weak spreads with feedstock isomer-grade xylene.
Asian MX levels are gradually approaching the $1,300/tonne FOB Korea mark after a week of steady upward movement ahead of August. The market has been tracking upstream energy gains and the bullishness downstream on PTA.
Following a fire at China’s Dragon Aromatics’ upstream refinery facility in Fujian province last week, there is also some uncertainty about the potential impact on the xylenes market in Asia.
Some upward movement for MX in the US market, which has seen a renewal in spot activity in the run up to August and lower production output so far in 2013, is also supporting the growing uptrend for European MX. Spot deals were done at $4.00/gal and $4.02/gal last week, pushing the market back above $1,200/tonne.
($1 = €0.75)
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