Emerging demand from South Korea fails to lift naphtha crack in Asia, amid persistently excess supply

26-Jul-17

Asia's gasoline and naphtha cracks were each at a five-session low at US$10.15 a barrel and US$59.5/ton, respectively, weighed down by higher crude prices, as per Reuters. Naphtha demand emerged from South Korea but this did little to offset the weak fundamentals, as supply was persistently in excess.
South Korea's YNCC bought three cargoes averaging a total of 75,000 tons for H1- September arrival at Yeosu, at discounts of about US$2.50/ton to Japan quotes on a cost-and-freight (C&F) basis. - This was unchanged from the purchase tender YNCC had on July 19, reflecting that market fundamentals had barely changed since then where oversupply persisted, and keeping prices at discount levels.
Hanwha Total has also bought naphtha for first-half September arrival at Daesan.
Reliance Industries sold 55,000 tons of naphtha late last week for Aug. 15-18 loading from Sikka to Petro-Diamond at premiums of about $5 a tonne to Middle East quotes on a free-on-board (FOB) basis.
LG Chem had a brief power outage at its Yeosu cracker late last week but operations were unaffected, an industry source said.
Taiwan's CPC Corp plans to shut an 80,000 barrels per day gasoline-making unit at its Talin refinery in September, a company spokesman told Reuters.