SINGAPORE: Korea Petrochemical Ind Co Ltd (KPIC) is the latest to join a string of petrochemical firms in South Korea in seeking naphtha through term contracts as prices have fallen significantly due to ample supplies, traders said on Monday.
KPIC, South Korea's smallest ethylene producer by capacity, is seeking at least 100,000 tonnes of naphtha for October 2014 to December 2015 arrival at Onsan through a tender that closes on Aug. 18.
The tender is valid until Aug. 20.
The tender, which requested for a cargo per quarter, came after Lotte Chemical purchased about 400,000 tonnes of naphtha for October 2014 to September 2015 delivery on Aug. 13 at a premium of about $4.50 a tonne to Japan quotes on a cost-and-freight (C&F) basis.
A week before that, on Aug. 7, YNCC bought about 200,000 tonnes for October 2014 to March 2015 delivery at a premium of $5.00 to $5.50 a tonne.
Traders said LG Chem also likely signed a term deal last week but details were not immediately available.
Persistently high naphtha supplies caused by weaker demand as the gasoline season ends have led to prices flipping into discount on Aug. 7 in South Korea for the first time since October 2013.
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