4 June, 2018
The FOB Korea benzene market softened early in the week due to falling crude prices but rose after that on the back of high derivative styrene monomer (SM) prices. The FOB Korea toluene market also tracked movements in crude prices, weakening in the early part of the week and rebounding slightly after that. Paraxylene prices lacked upward momentum even after crude prices rebounded as new facilities were starting and maintenance was finishing.
The CFR Northeast Asia ethylene market continued to strengthen. For June delivery, amid tight supply/demand fundamentals and surging derivative SM prices, ethylene demand for SM production was strong. On the supply side, naphtha crackers were under maintenance and MTO units in China continued to reduce production, generating a sense of supply tightness. Under this situation a deal was done for June delivery at $1,375/mt and another deal was done for July delivery at $1,345/mt.
In the Asia propylene market, CFR Northeast Asia and CFR Southeast Asia prices fell while FOB Korea prices were unchanged. The CFR Northeast Asia market softened as buying interest from end-users decreased amid weakness in China domestic prices. In the China domestic market, derivative polypropylene makers halted operations due to worsening profitability and propylene demand weakened. In Korea, few bids and offers were heard and activity was thin.
The Asia butadiene market fell. In Northeast Asia, derivative synthetic rubber prices failed to catch up with high butadiene prices and some synthetic rubber makers halted operations. Under this situation, butadiene prices were deemed to be relative high and underwent a downward correction. In Southeast Asia, Thailand’s PTTGC conducted a sell tender for July loading.