Spot Northwest European benzene prices fell by at least $60/mt for March and around $35/mt for April Wednesday morning, as sellers were forced to offer aggressively as sources reported an increasingly lengthening market.
There was uncertainty over the market direction at the beginning of the day, with March seen at a wide bid/offer range of $1,290-1,330/mt for 1,000 mt CIF Amsterdam-Rotterdam-Antwerp.
The bid level compared with trades done at $1,330/mt late Tuesday however and one source felt the reluctance of buyers to come up indicated a bearish market.
"There is a bearish vibe now. The market seems covered and nobody is aggressively looking to buy. In fact bids of $1,290/mt are aggressive compared to where the market has been," the source said.
April initially appeared stable to the previous day at a range of $1,260-1,285/mt, although a weaker market was confirmed when two trades were heard done at $1,270/mt. Following this, April dropped further, with a trade confirmed done at $1,250/mt as the range moved to $1,240-1,260/mt.
March offers came down significantly following this, with sellers heard as low as $1,280/mt against bids of $1,260/mt, before rising to a range of $1,270-1,290/mt.
Sources said that Wednesday's fall was a result of "aggressive selling" by traders, with one source adding: "There are very few buyers and it seems that one trader is very long."
A second trader added that following a period of sustained price increases which saw the February and March monthly contract price agreements settled at record highs, the market could be set for further falls going forward.
"The overall picture seems much more bearish now. On the short term it could spike up once again driven by the energy complex, but over the next few months prices should come down significantly," the trader said.
Although significant volumes of benzene were still expected to land in Europe from Asia through March and April, major turnarounds in that period, plus the possibility of increases in crude, have meant several sources were still less sure prices would continue to fall.
"Going forward it's tough to call the direction. The fundamentals are probably balanced to tight for March and April. If there is any sort of production problem then the market will be really tight," one trader said.
