Houston — Spot US Gulf Coast paraxylene prices were assessed at $1,304/mt on Wednesday, their highest point since August 15, 2014, when the assessment was $1,315/mt, according to S&P Global Platts data.
Since July 2, the spot US paraxylene price has risen $356/mt or 37.6%, tracking Asian markets higher.
Asian prices have risen $388/mt or 38.76% since July 2, when the Platts CFR Taiwan/China W5 marker was assessed at $1,001/mt.
The strength in the Asian PX market is mostly on the back of strong demand, supply tightness and falling inventory in the purified terephthalic acid market. PTA is a direct downstream product of paraxylene.
Sources have indicated that over the past two months, US spot paraxylene prices have been priced based on the Asian market minus the cost of shipping.
Sources say this method of price evaluation is the most accurate, as a majority of US-origin PX has been traveling to northeast Asia following a decline in Mexican demand.
The Alpek plant in Altamira, Mexico, was shut in mid-July after a fire. Restart procedures are still underway. Alpek has an estimated PTA capacity of 500,000 mt/year for each of its two PTA lines at the Altamira plant.
Despite the market still pricing US spot paraxylene on a netback to Asia, some uncertainty has arisen in the past few weeks. The current round of retaliatory tariffs from China against the US includes paraxylene, causing many market participants to re-evaluate cargo flows moving forward.
The trade flow and pricing thought process is still an Asia netback model, one source said on Wednesday, adding that there is a lot of scrambling going on about figuring out the logistics of the tariff situation. Many in the market are attempting to work out a South Korea or Taiwan processing point to make the cargoes work, but talks are still ongoing, the source said.
On August 15, it was reported that three 10,000 mt paraxylene cargoes were heading from Houston Texas City to Northeast Asia, with delivery between August 10 and August 20 for two of the cargoes, and August 10 and August 25 for the third. It was also reported that all three cargoes were fixed clean and freight rates were listed at or near $48/mt.
