Naphtha in Asia eases from over eight month highs on anticipated advent from the West

13-Nov-13

The Asian naphtha margin eased from an 8-1/2 month high to a two-session low of US$146.75/ton on Tuesday, but remained 33.4% above this year's average in a reflection of lower supply, as per Reuters. The naphtha bull run, which started around mid-October, could persist but only for another two to three weeks at most, traders said. More than 1.5 mln tons of western naphtha are expected, with some 400,000 tons awaited from the United States. "Stocks are not too high at the moment, so Asia can take in more and then we will see what happens after this," said a Singapore-based trader. "Not everyone is convinced that the U.S. can export 400,000 tons a month of naphtha," a Singapore-based trader said. Some sign of easing in the tight supply emerged with Malaysia-based Lotte Chemical Titan's success in buying 22,500 to 30,000 tons of naphtha for H2-December arrival at PasirGudang. This was its third attempt. It paid about US$6/ton premium to Japan quotes on a cost-and-freight (C&F) basis. On Oct. 23 and Oct. 31 it had cancelled attempts to buy December cargoes due to a lack of offers.