Toluene Prices, markets & analysis
The Toluene markets are covered by ICIS weekly in Asia, Europe and the US, while a daily report is also available for Asia. This reliable and trustworthy tool allows you to stay up-to-date with news and analysis and gives you the confidence to make vital commercial decisions.
Price assessments cover spot activity over the week as well as at close of business and contract prices are also published in Europe. This market intelligence is compiled by our locally-based reporters and commentary includes news on deals taking place, feedstock movements, demand and supply trends, outlooks, regional focus as well as graphs.
Our editor gives their expert view
Toluene overview Transcript
Toluene is a basic chemical and a feedstock for a wide range of applications.
Toluene is used primarily as a solvent for paints, coatings and cleaners in China, Southeast Asia and India. It is also used widely in this region for the production of toluene diisocyanate or TDI.
Toluene’s use is key in the production of benzene and mixed xylenes via toluene disproportionation or TDP, and hydro dealkylation or HAD, which make up about 20% of Asia’s aromatics production.
The use of toluene as a blendstock for gasoline blending is a key emerging segment in Asia. It started with the US, where MTBE was banned from the gasoline pool resulting in the increased use of toluene as an octane booster. In Asia toluene’s consumption for gasoline blending is increasing rapidly, especially in countries like China, which is expected to soon become the world’s largest car market.
Toluene is produced from the catalytic reforming of naphtha and from pyrolysis gasoline coproduced in the steam cracking of liquid feedstocks.
Not surprisingly China is the largest importer in Asia. It imports between 50,000 and 70,000 tonnes of toluene every month. But regional exporters are facing stiff competition following capacity additions by local giants like Sinopec, hence toluene exporters in Asia are increasingly turning towards India. India is seen as the next most rapidly growing market with estimated growth at about 7 to 8% per year.
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Toluene: Market overview
Updated to Q1 2016
US Gulf toluene spot values remained elevated in a tight market through the end of 2015 with less softening of prices at the end of the US summer driving season than market players expected. Toluene supply remains tight due to limited offers from refineries amid strong gasoline production and strong gasoline exports, although prices have tracked declines in upstream crude oil. Near the end of the first quarter, prices are expected to rise ahead of the 2016 US summer driving season.
Europe toluene prices should maintain the link to gasoline with few alternative outlets for material. Availability is limited with producers choosing to extract minimum values from the gasoline pool. Export demand will depend on Chinese demand post Lunar New-Year, and US refineries. TDI demand is expected to be muted despite new capacities in Europe.
In Asia, supply fundamentals are expected to increase in the February-March period because of better netbacks for selling toluene and stable refinery margins, with possibilities of operating rate cuts in downstream TDP and STDP plants evident. Sellers are mulling their options to sell to deep-sea regions such as the US for February and March loading cargoes before the summer blending season. This isbecause demand looks largely stable-to-soft, even Chinese inventories could maintain below the 50,000-tonne mark before March and a possibility that blending values could be unworkable for toluene in the domestic market amid sufficient mixed aromatics availability.
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Toluene is a colourless, mobile liquid with a characteristic sweet, pungent, benzene-like odour. It is an irritant to the eyes, skin, nose and lungs. Toluene is a dangerous fire hazard and can lead to a flashback due to its heavy vapour.
The main chemical use of toluene is to make benzene and xylenes using a number of technologies.
Toluene is also used in solvent applications and is consumed in the manufacture of toluene diisocyanate (TDI) which is used in the manufacture of polyurethane foams. Smaller uses for TDI include polyurethane elastomers and coatings.
Other minor chemical uses include the manufacture of phenol, caprolactam, nitrobenzene, benzoic acid and benzyl chloride.
In non-chemical uses, toluene is used in large quantities as an octane booster in gasoline but most of that portion remains in the refinery streams.
There are three grades of toluene: TDI grade of 99+% purity; nitration grade at 98.5-100%.
The original source of toluene from coke-oven gas has been replaced by the catalytic reforming of naphthas and from pyrolysis gasoline co-produced in the steam cracking of liquid feedstocks. A very small amount is still produced from light oil formed by the carbonisation of coal.