Asia's naphtha crack edged up on Monday to a nearly two-week high of $72.75 a tonne, supported by spot and term demand. South Korea's Hanwha Total and SK Energy were in the market seeking spot naphtha, traders said. The two buyers have bought a total of at least 75,000 tonnes of heavy full-range naphtha for second-half April delivery, they added.
"Supplies have tightened compared to last week so deals on heavy full-range naphtha would be done at premiums of at least $1 today," said a naphtha trader not related to the buyers. Buyers and sellers do not typically comment on their deals. Last week, buyers from Japan, South Korea and Malaysia had bought a total of at least 200,000 tonnes of naphtha comprising full-range and open-specification grades for second-half April delivery at discount levels.
Apart from the string of spot demand since last week, YNCC and LG Chem were also seeking cargoes but under term contracts. About 1.4 million tonnes of naphtha could arrive in Asia next month from the West, including Europe and the Mediterranean, making this the highest monthly volume to arrive in about a year, estimates from traders showed. Despite the volume being 40 percent higher than the number of cargoes arriving this month, Asia's demand for western cargoes is expected to exceed 1.4 million tonnes, an industry source based in Singapore said.
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