Naphtha prices in Asia sink to over 6 week lows

21-Sep-12

Naphtha price in Asia fell for the fourth straight day on Thursday to tank to a 1-1/2 month low of US$915/ton amid margins that slid to a two-session low of US$107.93/ton on ample supplies, as per Reuters. The weaker fundamentals pressured premiums. South Korea's Honam Petrochemical bought two 25,000 ton cargoes for H1-November arrival at Daesan port at about US$10.50/ton above Japan quotes on a cost-and-freight (C&F) basis. This was the lowest premium seen in South Korea in about three weeks. Most traders seem convinced that the market will stay weak for long as Asian crackers, especially those in South Korea, were mostly running at full-tilt. Additionally, Asia's top naphtha buyer, Formosa Petrochemical Corp, has also ended its maintenance for the year at its 2.93 mln tpa cracking complex in Mailiao.