Robust industry demand has led Asian naphtha prices to recover to a three-session high midweek, while cracks rebounded from a near two-week low to reach their highest in a week, as per Reuters. Amid ample supplies, sentiments have been boosted as South Korea's Honam Petrochemical and Samsung Total, and Japan’s Exxon and Tosoh seek cargoes for December. Honam bought 75,000 tons of open spec naphtha for H1-December arrival at premiums averaging US$2.25/ton to Japan spot quotes on a cost-and-freight (C&F) basis. Honam will likely opt for full-range grade naphtha, priced US$1.50/ton higher than open-spec grade. Samsung Total bought one open-spec cargo for Dec. 10-20 arrival at premiums of US$2.50/ton on a C&F basis, totaling purchase in two days to 50,000 tons. Japan’s Tosoh bought a cargo at undisclosed premium levels.
Despite ample supplies, crack values are likely to be range bound in the current high levels in the short-term, because strong petrochemical margins are supporting high cracker runs. This has prompted SK Energy to revive a 200,000 tpa cracker after a two-year shutdown. The cracker is expected to resume operations next month.