Supply outpaces demand - naphtha crack in Asia falls to 27 month low

29-Oct-14

As supply outpaces demand, naphtha crack in Asia fell for a third consecutive session to plunge to a 27 month low of US$58.2/ton at the start of the week, as per Reuters. Philippine petrochemical producer JG Summit returned to the market to seek a December naphtha cargo after having bought a H2-November cargo about two weeks ago at a discount of about US$11/ton to Japan quotes on a cost-and-freight (C&F) basis. The company, operating the only cracker in the Philippines, is to award the tender to buy the 30,000 ton cargo for H1-December delivery to Batangas on October 29. A South Korean petrochemical firm also is expected to issue a purchase tender from Tuesday, traders said. A petrochemical unit at Total's Antwerp refinery shut this week for maintenance, which is expected to last at least a month. This would free up naphtha, the feedstock needed for the unit. Europe usually sends excess naphtha to Asia, which used to be structurally short of the light fuel.