Benzene to arrive into China late April from US Gulf Coast - a rare reversal of arbitrage flow

27-Mar-15

Up to 30,000 mt of benzene is expected to arrive into China late April shipped from the US Gulf Coast in late February and early March, representing a rare reversal of the typical arbitrage flow for the material between Asia and the US, market sources have been quoed in Platts. A trader based in China also estimated that 20,000 mt of benzene will arrive in China from the US in March. "In January and February, US benzene was oversupplied. But the Asia price [was] up and up," said the trader in China. Benzene typically flows from Asia to the US in relatively large quantities, but this dynamic changed in late February after Chinese domestic prices firmed enough to support a reversal of the cargo flow. Rising styrene monomer prices and firm demand also from diphenylmethane diisocyanate (MDI), supported prices, sources said. On February 23, the US Gulf Coast benzene price was assessed at US$598/mt, while the FOB Korea price was US$645/mt, a spread of US$47/mt.