South Korea’s YNCC interested in buying term naphtha, and sellers have reached a deadlock in their naphtha term talks due to gap in buying and selling ideas. As per traders in Reuters, lack of conclusions to YNCC's latest term tender could lead to cancellation of the tender for naphtha cargoes originally meant for September 2012 to August 2013 delivery.
YNCC had placed bids at US$1.50/ton premium to Japan quotes on a cost-and-freight (C&F) basis but these failed to interest suppliers, who quoted offers from US$5/ton premium. The trigger for the higher premiums is the high naphtha prices in Europe, supported by gasoline, that are influencing prices in Asia. In H2-June, Honam Petrochemical secured term parcels at prices ranging from a discount of 50 cents to a premium of 50 cents.
YNCC has an existing contract which expires in December for around 800,000 tons of naphtha for 2012 delivery at a discount of 50 cents a tonne to Japan quotes on a cost-and-freight (C&F) basis with about seven sellers.