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 2020
Supply was ample in Asia, keeping the market structure in a contango. During the period, Asia saw a loss in PX production by around 874,600 tonnes as a result of scheduled maintenance. China’s Sinochem Hongrun shut its 800,000 tonne/year PX unit in mid-May, with the restart timing remaining unclear. There was an increase in the volume of cargoes from the Middle East and India being shipped into Asia.
Various countries imposed lockdowns to control the spread of the pandemic. As a result, several PTA facilities either reduced their operating rates or shut, reducing demand for PX. The region saw a production loss of around 1.5m tonnes of PTA, equivalent to a PX demand loss of 990,000 tonnes. Out of the total PTA production loss, 498,900 tonnes accounted for the unplanned segment.
Supply of PX lengthened further during Q2. Supply conditions were long throughout the quarter as ample capacity and weak demand, particularly for spot transactions, resulted in limited pressure on availability.
Demand for PX remained weak in Q2. Increased demand for key derivative PET was seen as coronavirus quarantine measures boosted sales of packaged goods. However, the increase in downstream consumption did not result in an increase in demand for PX.
In early Q2, large volumes of PX imports – originally intended for China – were rerouted to the US east coast, amid demand destruction in China. The economics of PX extraction continued to be largely unfavourable, amid crashing crude oil and aromatics prices, and run rates decreased as a result. Amid the coronavirus pandemic, refiners had little incentive to extract xylenes, choosing to keep them in the gasoline stream or export MX to the east.
Derivative PET production ran at high rates. Strong consumption into packaging of food, bottled water and particularly of hand sanitizer was spurred by panic buying activity at the consumer level due to the spread of the coronavirus.
Updated to Q2 2020
Supply was ample, with operating rates at OX facilities stable. There was also ample availability of Europe-origin cargoes offered into the Asian markets. Chinese inventory levels were relatively high at around 30,000-40,000 tonnes.
Demand was weaker during the period, largely a result of several planned maintenance shutdowns at downstream PA facilities. The region saw a PA production loss of around 70,800 tonnes during the quarter. A bearish global macroeconomic environment had exerted downward pressure on demand, with end-users largely sitting on comfortable OX inventories.
Supply of OX was long throughout Q2 due to weak demand. This length was seen even though there was no production of OX from BP’s plant in Gelsenkirchen, Germany, according to market sources. BP did not comment when asked to clarify the plant’s status.
Demand for OX fell, largely due to the impact of the coronavirus pandemic on the key downstream automotive and construction industries. Automotive was heavily impacted by the pandemic, with production and sales both down significantly. Construction was more resilient and increases in demand late in the quarter for downstream PA were attributed to this sector.
The economics of OX extraction continued to be largely unattractive, amid crashing crude oil and aromatics prices, and run rates decreased as a result. As the coronavirus hit the US, refiners had little incentive to extract xylenes, choosing to keep them in the gasoline stream or export MX to the east.
Construction projects were largely postponed or cancelled, and automotive production halted for two months, limiting demand for downstream PA into plasticizers. End-use PVC production rates were ultimately lowered, although export demand recovered more quickly than domestic. End-use paint and coatings were mixed, as industrial uses were significantly reduced but purchases for DIY applications flourished.
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.