The Paraxylene-Orthoxylene (PX-OX) markets are covered by ICIS’ network of locally-based reporters in Asia, Europe and the US. The weekly reports bring you in-depth news on spot on contract markets and analysis in the commentary provides intelligence on developments in market activity, upstream movements, production news and graphs.
These are an essential tool for those involved in the industry to keep abreast of market movements and make crucial commercial choices.
Updated to Q2 2019
Paraxylene (PX) supply was restricted during the quarter, amid several unplanned outages and production cutbacks, which resulted in limited availability for the prompt market. A northeast Asian PX producer cut operating rates to 80% of its total capacity, while PX plant issues in both India and the Middle East tighten supply within Asia. Taiwan’s FCFC shut its No 3 PX unit in early April following an incident at its reformer unit.
Demand from China was steady, as downstream PTA production margins were healthy. The average Chinese operating rates of PTA facilities during the quarter stood at an average of 82%. PX inventories at end-users facilities’ were low, as buyers were mitigating inventory losses, resulting in a need-to basis buying pattern.
European supply of paraxylene (PX) remained balanced during Q2. Limited demand, particularly for spot material, contributed to the good availability of material. However, global capacity rose significantly as Hengli started up its 4.5m tonne PX unit in Dalian, China.
Demand for PX was generally weak during Q2, particularly for spot material. Demand for derivative polyethylene terephthalate (PET) was impacted by high inventories and weak seasonal consumption, even though Q2 typically makes up part of the peak bottling season.
Supply of paraxylene (PX) increased in the second quarter as growing oversupply stemming from new production in the key China market continued to extend into the domestic market in North America. Supply also increased amid higher refinery operating rates in preparation for the summer gasoline season. Global oversupply outweighed a small production disruption and exerted downward pressure on the market throughout the quarter.
Demand decreased in the second quarter alongside weak demand in the North American PET market amid poor weather conditions and a delay in the start of the peak plastic drinking bottle season. PET operating rates were low, decreasing demand for PX for PET production. Ongoing tensions surrounding the US-China trade war also weighed on demand. New capacities in the key China market also decreased demand for US exports to Asia.
Updated to Q2 2019
Supply of orthoxylenes (OX) in Asia in Q2 was mixed. Early in the quarter, supply was constrained as buyers in Europe continued to source from Asia amid a force majeure at major European producer BP’s facility, reducing spot availability in the region. However, poorly performing downstream phthalic anhydride (PA) markets later in the quarter curbed buying interest, leading to an oversupply in China as producers struggled to stimulate interest in cargo.
Demand of OX in Asia in Q2 was mostly weak. Majority of OX buyers in the region were sufficiently covered by contractual cargo, limiting interest in spot parcels. Tepid downstream PA trade further curbed demand for the material. In the domestic Chinese market, spot demand declined amid high domestic inventories owing to falling export trade. This was despite a reduced tax rate in China that set in on 1 April.
Availability of orthoxylene (OX) improved in the second quarter, despite the ongoing force majeure from major producer BP’s Gelsenkirchen, Germany site. Imported volumes from Asia and the US, which were attracted by rising spot prices, re-balanced the European market. This is an atypical trade flow, with a trader saying that high logistics costs usually limit European imports from these regions.
Demand for OX during the quarter was mixed, though generally healthy in April and May. Sources said in May that there had been an increase in seasonal demand for material, though this rise in consumption was smaller than usual. A trader said in June that spot demand was limited. The source attributed this to weaker-than-expected consumption of OX, with buyers’ needs covered by imported material.
Supply increased in the second quarter with higher refinery rates in preparation for the summer gasoline season. Production issues and supply shortages in Europe prompted increased exports from the US to Europe but did not adversely impact supply given better arbitrage opportunities from Asia to Europe. Weaker-than-expected demand stemming from poor weather and a delay in the typical peak construction season also contributed to increased supply during the quarter.
Demand was weaker in the second quarter amid poor weather and a delayed start of the peak construction season. Production issues and supply shortages in Europe did increase demand for US exports to the region, although most of these exports came from Asia given more economically advantageous arbitrage opportunities. Domestic demand was also hampered during a week-long production outage at Koppers’ downstream phthalic anhydride (PA) plant in Stickney, Illinois in late April.
We offer the following regional Paraxylene-Orthoxylene analysis and news coverage to keep you informed of factors and developments affecting prices in the Paraxylene-Orthoxylene marketplace.
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Paraxylene (PX) is the largest volume isomer of the mixed xylenes. Orthoxylene (OX) is the second largest of the three commercial isomers of xylene.
Paraxylene (PX) is the largest volume isomer of the mixed xylenes. Around 98 percent of PX demand comes from the polyester chain via the one of its intermediates purified terephthalic acid (PTA) or dimethyl terephthalate (DMT). The breakdown for polyester demand is 65 percent from fibre, 27 percent from polyethylene terephthalate(PET) bottle resin and the remainder from film and other plastic end uses. Polyester demand is expected to grow at six percent a year over the next few years with the PET resin bottle market seeing the fastest growth. A small amount of PX is used as a solvent and in the production of di-paraxylene and herbicides.
Paraxylene is a flammable liquid and a fire hazard. When heated to decomposition, paraxylene emits acrid smoke and fumes. Vapours may travel to a source of ignition and flash back.
Orthoxylene (OX) is the second largest of the three commercial isomers of xylene. Almost all OX produced is consumed in the manufacture of phthalic anhydride, which is converted to plasticisers, alkyd and polyester resins. Small quantities are used in solvent applications and to make bactericides, soybean herbicides and lube oil additives. It is also used to make phthalonitrile, which is converted to copper phthalocyanine, a pigment.
Orthoxylene is a flammable liquid and a fire hazard. When heated to decomposition, orthoxylene emits acrid smoke and fumes. Vapours may travel to a source of ignition and flash back.
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