Asian aromatics makers reduce run rates on high cracks due to naphtha supply crunch

Aromatics producers in Asia have reduced run rates due to a naphtha supply crunch that has driven up crack spreads to near 20-month-high levels, as per iCIS. Regional naphtha demand has been robust, with China, South Korea and Japan scuttling for spot cargoes amid delayed arbitrage shipments from Europe due to freezing temperatures there. As a result of the supply shortage, few paraxylene (PX) players had reduced their rates- Idemitsu Kosan is running both its Paraxylene units at 80-90% this month and into into February. Taiwan’s CPC has reduced run rates at its No 3 PX line at 80-90% for January and February, while its No 2 PX line was running lower at 70-80%. Aromatics units in China were also reported to be running at reduced rates due to the naphtha crunch. In Japan, hydrodealkylation (HDA) and toluene disproportionation (TDP) units were operating at 35-50%, as the lack of naphtha feedstock resulted in tight toluene supply. Around 500,000 tonnes of European naphtha had been earmarked for Asia for January delivery, but that some supply would spill over to February amid transportation difficulties.
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