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Weekly Summary

Petrochemicals: Jan 10-14: Ethylene softens, makers move to cut production

Aromatics

The FOB Korea benzene and the CFR Northeast Asia paraxylene (PX) market strengthened along with firmness in benchmark feedstock crude and naphtha prices. The benzene market was also supported by strength in derivative styrene monomer (SM) prices. In the SM market, supply was tight since Korean makers reduced production.

 

Olefins

The CFR Northeast Asia ethylene market decreased as buying interest weakened due to a fall in profitability of derivatives. In the middle of the week, a deal was heard at $950/mt. Regarding facilities, operation rates of Lotte Chemical's naphtha cracker in Daesan in Korea decreased due to malfunctions. Apart from this, in Korea, Korea Petrochemical Ind Co (KPIC) and Hanwha Total decided to adjust operations of their naphtha crackers. Operation rates of other facilities were also decreasing due to troubles.

 

The Asia propylene market strengthened. In Northeast Asia, a number of facilities were undergoing maintenance or experiencing troubles and supply was perceived to be tight. Chinese end-users, however, were not keen to purchase imported cargoes as derivative polypropylene prices were softening and domestic supply was seen to be ample going forward. In Korea, Lotte Chemical's naphtha cracker in Daesan was operating at low rates due to glitches. In Southeast Asia, Thailand's PTTGC conducted a sell tender.

 

The Asia butadiene market was an uptrend. In Northeast Asia, Korean makers sold large quantities to the US and several petrochemical makers reduced run rates at their naphtha crackers. Therefore, perceptions of ample supply eased. Further, the China domestic market moved up as buyers were building stocks ahead of the Lunar New Year.

 

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Tokyo : Petrochemicals Team  Shinnosuke Tagusari   +81-3-3552-2411Copyright © RIM Intelligence Co. ALL RIGHTS RESERVED.