[Aromatics]

Benzene prices on an FOB Korea basis were bullish until the middle of the week due to an increase in derivative styrene monomer (SM) prices. For SM, inventories held by makers were low. Due to a fire at a facility and other troubles, production decreased. Paraxylene (PX) prices increased along with a rise in futures prices for PX.

[Gasoline Components]

MTBE prices on an FOB China basis strengthened owing to recent firmness in crude prices. In China, new MTBE facilities started up one after another. Operation rates were only at about 70% on average.

[Olefins]

Ethylene prices on a CFR Northeast Asia basis softened slightly. Since the spread between benchmark feedstock naphtha and ethylene prices shrank, ethylene makers were considering reducing production further. In China, a major importing country, production capacity was rising. Further, cargoes from outside the region that were previously traded were arriving and supply was seen to be ample. Since operation rates of derivative facilities were low, demand for ethylene was capped and supply/demand was unlikely to tighten.

In the Asia propylene market, supply was perceived to be tight.

In the CFR Northeast Asia market, supply was tight but buying interest was observed from Chinese end-users. Therefore, market sentiments were strong.

In South Korea, negotiations for February loading were over while it was perceived to be too early to start discussions for March loading. As a result, trader was muted.

In the Southeast Asia market, fresh talks were not heard.

In the CFR Northeast Asia butadiene market, discussions for February cargoes were over and trade was muted. Regarding facilities, some makers in Taiwan were considering shutting down naphtha crackers while a naphtha cracker in Japan was experiencing troubles. For these reasons, supply for butadiene was seen to be tight. The market might remain bullish, depending on buying interest from end-users in South Korea and Taiwan.

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