Naphtha prices in Asia have eased to a two-session low and cracks recovered to near fresh three-year highs, as per Reuters. Naphtha cracks are rising with intermonth spread holding strong, supported by demand and persistently tight supplies. Open spec naphtha for front-month H2 February fell by over ten dollars to US$885.50/ton. Naphtha cracks recovered US$4.35 to US$186.50/ton premium, highest since Jan. 25 2008 at nearly US$187/ton.
Taiwan's CPC bought 30,000 tons of full-range naphtha for H2 February arrival at premiums of US$9-10/ton to Japan quotes on a cost-and-freight (C&F) basis. Malaysia's Titan Chemicals bought around 25,000 tons of full-range naphtha, for H2 February arrival at high single-digit premiums on a C&F basis to Japan quotes.
But CPC has not yet sealed a term deal for 2011, despite over two months of negotiations because of tight supplies that make it difficult to reach an agreement. Naphtha supplies have been tight since late 2010 due to delays in shipments in the Gulf and impending refinery and splitter maintenance in 2011. Strength in naphtha is expected to be sustained due to healthy demand amid lower supplies from the Gulf, because of continuous refinery maintenance between January and April.
06-Jan-11 
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