SINGAPORE: Asia's naphtha crack rebounded marginally on Wednesday from a 6-1/2 month low to reach a two-session high of $49.62 a tonne, with firm demand seen from North Asia.
Taiwanese Formosa, Asia's top naphtha importer, was seeking open-specification naphtha for second-half April delivery to Mailiao while South Korea's YNCC bought naphtha for second-half April delivery to Yeosu.
But weak fundamentals kept a tight lid on prices and prevented them from rising.
South Korea's YNCC paid a discount of $8.50 a tonne to Japan quotes on a cost-and-freight (C&F) basis for three cargoes totalling about 75,000 tonnes. The deal price was similar to what Lotte Chemical paid the previous day for two cargoes delivering to Yeosu over the same period.
Lotte also bought two more naphtha cargoes for second-half April delivery to Daesan on Tuesday at a discount of $7.00 while KPIC bought a cargo on March 8 for the same delivery period at a discount of about $7.
Discounts at such wide levels in South Korea have not been seen since January 2015.
"Ample supplies were affecting the April prices. I still see Europe shipping a lot of cargoes to Asia," said a Singapore-based trader who added he was not expecting fundamentals to improve anytime soon.
So far, about 1.5 million tonnes of Western naphtha from regions of Europe and the Mediterranean, have been provisionally booked for April arrival.
The final number is likely to be higher as there is still time for April arrival shipments to be booked.
CRACKER NEWS: Indonesia's Chandra Asri has been operating its 860,000 tonnes per year (tpy) cracker at rates below 75 percent for the last two weeks following mechanical issues, traders said.
They said cracker throughput will likely be kept below 75 percent for some time although no exact timeline was available.
Japan's Tosoh Corp has shut its 527,000 tonne per year naphtha cracker in Yokkaichi on Tuesday for scheduled maintenance.
The cracker is expected to be restarted in mid-April.
Comments
Comments are closed for this article.