03-Oct-16 Asia's naphtha crack extended losses for the third straight session on Thursday of the previous week to reach a two-week low of US$43.8/ton, amid cracker outage in Singapore. Royal Dutch Shell has declared force majeure on supplies of its base chemicals from its cracker located in Bukom Singapore following a compressor problem. Traders opined in Reuters that as naphtha is volatile due to the uncertainties in the supply structure, all it takes is one major cracker outage to bring the market down. The steady stream of demand from North Asia this week and last, coupled with lower incoming European cargoes and efforts of traders having diverted some of the Middle Eastern and Indian naphtha away from Asia to the West could not overturn the weak sentiment.
South Korea's LG Chem managed to pick up naphtha for H1-November delivery at a discount of about US$5.50/ton to Japan quotes on a cost-and-freight (C&F) basis, making this the widest discount in the country in about 3-1/2 weeks. Asia's top naphtha importer Taiwanese Formosa came forward amid the weaker market to seek open specification grade naphtha for first-half November arrival at Mailiao.
