Asian petrochemical producers roll over naphtha deliveries to April, signaling a downtrend

A handful of Asian petrochemical producers have rolled over their naphtha deliveries to April from March, signalling a downtrend in the naphtha market, as per ICIS. Falling ethylene prices undermined confidence in the market, which saw the recent spikes in the prices of the naphtha feedstock followed by the swift ebb. Asian ethylene prices fell by US$40-50/ at the close of trade on 6 March to US$1330-1350/ton CFR (cost & freight) NE (northeast) Asia, according to ICIS data. Ethylene prices were weaker compared with four weeks ago when prices were assessed at US$1380-1420/ton CFR NE Asia. In response to the collapse of the downstream methyl ethyl ketone [MEK] market late last week, Asian naphtha prices fell earlier in the week to US$948-950/ton CFR Japan before rebounding on 6 March to US$966-968/ton CFR Japan on the back of crude oil futures support. However, on 7 March morning, naphtha prices fell to US$960-963/ton CFR Japan for the H2-April contract, triggered by overnight losses in global crude futures. “Some end-users are rolling inventory from March to April,” said one trader, adding that this came at a time when huge arbitrage volumes will be flowing into Asia from the Western markets. Asia will receive 1.3 mln tons of deep-sea naphtha material from northwest Europe, the Mediterranean, Russia and the US in March. A similar volume of western arbitrage supply is also expected for the month of April. Meanwhile, India’s refiners are exporting around 600,000 tons of naphtha in March, up from 500,000 tons shipped out in February. The spot premiums concluded in the week were also weaker, reflecting the market conditions. South Korea’s Lotte Chemical Corp bought 50,000 tons of spot naphtha supply for delivery to Yeosu in H1-April. The deal for the cargo was done at a premium of US$29/ton to Japan quotes CFR. Lotte previously bought 75,000 tons of spot naphtha supply for delivery to Daesan and Yeosu in H1-April at a premium of around US$35/ton to Japan quotes CFR. South Korea's Samsung Total bought 25,000 tons of naphtha for delivery to Daesan in H2-April at a weaker premium than Lotte’s purchase. Samsung last purchased a 25,000 ton naphtha cargo in the spot market for delivery to Daesan in H1-April, at a premium below US$40/ton to Japan quotes CFR. Naphtha prices were robust last month, mainly propped up by the increase in cracker run rates by Japanese end-users who were in turn enticed by the strength of the ethylene market then, traders said. Moving forward, some traders do not exclude the possibility of cracker run cuts since the downstream petrochemical demand starts to taper off.
  More News  Post Your Comment
{{comment.Name}} made a post.




There are no comments to display. Be the first one to comment!


Name Required.


Email Id Required.

Email Id Not Valid.


Mobile Required.

Email ID and Mobile Number are kept private and will not be shown publicly.

Message Required.

Click to Change image  Refresh Captcha