Regional demand pushes up naphtha margins in Asia to two week highs

04-Dec-13

Boosted by persistent strong demand, naphtha margins in Asia rose for a third consecutive session to reach an almost two-week high of US$152/ton. Lotte Chemical Titan has bought 67,500 to 90,000 tons of naphtha for Jan. 1-15 delivery at a premium of about US$12/ton above Japan quotes on a cost-and-freight (C&F) basis for three cargoes, the highest in about 10 months. The Malaysian bought one cargo just days ago. Taiwan's CPC also recently bought at least one 35,000 ton cargo each of heavy naphtha and full-range naphtha at premiums of US$30/ton and US$10/ton to Japan quotes on a C&F basis, respectively. The price of its full-range naphtha scheduled for Dec. 25 to Jan. 25 arrival at Kaohsiung reflected a significant jump from a cargo it bought about two months ago for Oct. 25 to Nov. 25 arrival at a discount of US$2/ton. Traders holding a bullish view said that strong Asian demand will easily soak up the high volumes of western imports arriving in December and January.