Asian benzene prices rise on firmer downstream styrene monomer demand

06-Jul-11
Benzene prices in Asia rose for the second consecutive day as a firmer downstream styrene monomer market offset an upstream fall in crude futures. As per Platts, FOB Korea price rose by four dollars to US$1060.50/mt on Tuesday. August ICE Brent crude futures fell by about half a dollar in the day to US$$111.08/barrel vs FOB Korea SM prices, which spiked by US$16/mt over the same period to US$1374.50/mt. Thus, the SM-benzene price spread widened to US$314/mt Tuesday from US$302/mt Monday. On January 13, it stood at US$312.50/mt. Typically, a spread higher than US$200-250/mt is considered healthy. Reasons affecting the sharp price hike are a partial solution to the Greece problem, the US economy which is not bad or not so good, and the third is the expected loosening of the Chinese monetary policy. Petrochemical Corp. of Singapore (PCS), plans to shut its No. 2 naphtha-fed steam cracker on July 21 for 35 days of annual maintenance. PCS' No. 2 aromatics plant can make 165,000 tpa of benzene. The US benzene price remained the highest globally at US$1100/mt FOB USG, European price was assessed at US$1081/mt CIF ARA. Asian styrene monomer price spiked to a premium over both the US and European prices on Tuesday, on tight spot cargo, better sales of expandable polystyrene, and a more stable macro economy of China Asian paraxylene gained six dollars day-on-day Tuesday to close at US$1376/mt CFR Taiwan/China despite crude prices easing back on a weak US dollar. The surge in interest was a welcome relief to the market, which had seen PX sidelined while downstream purified terephthalic acid was bogged down by long supply. But a small rally in PTA futures over the past two days injected new momentum into PX and buyers were back in force. PTA closed unchanged day-on-day at US$1158/mt CFR China for Taiwan origin cargoes. The US paraxylene price remained the highest globally at US$1447.50/mt FOB USG. The European PX price was at a nearly $25 discount to the US price.
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