Updated to mid-November 2009
Asian market review by Yu Guo, ICIS pricing
The Asian orthoxylene (OX) spot market has been slow-moving given the persistent weakness seen in the key downstream phthalic anhydride (PA) market. Spot prices softened $80/tonne through the second half of August and September before market players retreated to the sidelines in view of the week-long National Day holidays in the key Chinese market.
However, prices trended up after China returned from their holiday in early October as buyers started to procure amid low stock levels as well as rising feedstock costs. Major producers reiterated that OX margins have been squeezed and they would not hesitate to cut production if the erosion in margins persisted
Firm feedstock values continued to drive OX prices entering November. Spot prices hit $940/tonne CFR (cost and freight) NE Asia (northeast Asia) on the second week of November.
European market review by Truong Mellor, ICIS pricing
Tightening supply and a marginal upturn in demand saw the European September OX contract move up by €10/tonne to €660/tonne FD (free delivered) NWE (northwest Europe). However, weaker gasoline and mixed xylenes costs saw the October settlement drop by €45/tonne despite initial reluctance from suppliers.
The downstream PA market remained weak, which continued to add further downward pressure on OX prices as Q4 progressed. Players did not expect demand to improve during the rest of 2009, and some sources speculated that the sector would see shutdowns and the idling of plants in Q4 to help regulate the supply/demand balance.
Despite weak demand, November contracts moved up by €35/tonne to €650/tonne FD NWE, primarily because of availability issues caused by low Rhine River water levels although stronger upstream values helped push up price ideas. One consumer said that producers were originally looking for an increase of €70/tonne and that the €35/tonne hike was a compromise.
US market review by Ryan Hickman, ICIS pricing
Orthoxylene contract prices in the US have ebbed and flowed from August-November as energy prices dictated movements in a market mired with weak demand downstream.
A split August contract at 40-41 cents/lb ($882-904/tonne) set up a fractured delta when September contracts settled uniformly at 40 cents/lb.
Falling aromatics prices in October pulled down OX contract prices in the US for the month to put the benchmark at 37.50 cents/lb.
Spiking energy prices cleared an upward path for November as contracts rose to a 2009-high at 42 cents/lb.
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Orthoxylene
Uses and Outlook
Orthoxylene (OX) is the second largest of the three commercial isomers of xylene. Almost all OX output is consumed in the manufacture of phthalic anhydride (PA), which has three principal uses: phthalate plasticisers used in the compounding of polyvinyl chloride (PVC) resins; unsaturated polyesters resins (UPRs) used in glass-reinforced thermoset engineering applications; and alkyd resins used mainly for surface coatings.
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Orthoxylene
Process Technologies
Mixed xylenes are produced by high severity catalytic reforming of naphtha, from which the C8 stream contains ortho-, meta-, and para-xylenes, and ethylbenzene. Xylenes are also obtained from the pyrolysis gasoline stream in a naphtha steam cracker and by toluene disproportionation. The xylenes are passed through a splitter where the bottom stream with a targeted amount of OX is sent to an OX distillation column to produce high purity product.
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