Amid strong Brent crude, naphtha price in Asia lingered near a three-month high of US$903.50/ton on Monday. However, cracks slipped by 1% to reach a three-session low of US$88.63/ton on slower petrochemical demand growth, as per Reuters. Delay of the restart of it’s 700,000 tpa No. 1 naphtha cracker by Taiwan's Formosa Petrochemical Corp by a few days due to mechanical problems has dampened sellers' moods. The cracker was shut on June 19 for maintenance and was to restart on Aug. 5.
Since general market fundamentals continue to remain weak, any negative information seems to affect the naphtha market. South Korea's Honam Petrochemical bought a total of 75,000 tons of naphtha for September delivery into Daesan. It bought a 25,000 ton cargo for H1-September at premiums of US$4.5/ton to Japan quotes on a cost-and-freight (C&F) basis, pegged to a 30-day price formula. Another cargo for H2-September delivery was bought at US$4.5/ton to a 45-day price formula. The third cargo was also for H2-September delivery at US$6.50/ton premium and pegged to a 30-day price formula.