Benzene prices in Asia climbed for a second day running Tuesday as a firmer downstream styrene monomer market offset an upstream fall in crude futures. The FOB Korea price climbed $4 to $1,060.50/mt on Tuesday.
August ICE Brent crude futures sank 53 cents day-on-day to $111.08/b at 4:30 pm Singapore time (0830 GMT), in contrast with FOB Korea SM prices, which spiked $16/mt over the same period to $1,374.50/mt.
With SM's $16/mt day-on-day increase outpacing benzene's $4/mt rise, the SM-benzene price spread widened to $314/mt Tuesday from $302/mt Monday. At $302/mt, the spread was at its widest in six months, since January 13, when it stood at $312.50/mt. A spread higher than $200-250/mt is typically considered healthy.
In Southeast Asia, the Petrochemical Corp. of Singapore, or PCS, plans to shut its No. 2 naphtha-fed steam cracker July 21 for 35 days of annual maintenance. PCS' No. 2 aromatics plant can make 165,000 mt/year of benzene. The US benzene price remained the highest globally at $1,100/mt FOB USG. The European price was assessed at $1,081/mt CIF ARA.
This morning in Europe, July benzene was heard pegged between $1,080/mt and offered at $1,090/mt CIF ARA.
The Asian styrene monomer price spiked to a premium over both the US and European prices on Tuesday.
"There were three big issues. First Greece, which is solved to some extent, second was the US economy, which is not bad or not so good. Third, which is most important, the Chinese monetary policy is expected to be loosened, so the big problems are solved or are getting solved," a market participant said Tuesday, explaining why prices rose so sharply.
"Spot cargo is tight, sales of expandable polystyrene seems better and the macro economy of China seems stable," a Chinese trader said. The US styrene price has been stable near $1,360/mt FOB USG during the past week.
The European price was flat to the US price.
Asian toluene firmed Tuesday, with the FOB Korea marker assessed up $6.50/mt from the day before at $1,062.50/mt as buying gathered pace, with September cargoes the most widely discussed. The resurgence in interest, despite weaker crude, is likely due to factors including renewed buying from China, market sources said.
"Main traders are pushing the market," a South Korean producer said.
The East China price was heard at Yuan 8,300/mt, or $1,046.92/mt on an import parity basis, unchanged from the day before.
"Some plants [in China] have cut production rates to maintain prices," a trader in China said.
The US toluene price has spiked to near $1,125/mt in recent days as unleaded gasoline prices pushed blend values higher. The European toluene price was assessed at a $19 discount to the US at $1,105/mt FOB Rdam.
The US toluene price was being supported by stronger blend values. The blend value for US toluene climbed to near 375 cents/gal, about 5 cents above the US toluene price. During the past week, gasoline blend values for toluene in the US have climbed about 50 cents/gal.
Asian paraxylene gained $6/mt day-on-day Tuesday to close at $1,376/mt CFR Taiwan/China despite crude prices easing back on a weak US dollar. The surge in interest was a welcome relief to the market, which had seen PX sidelined while downstream purified terephthalic acid was bogged down by long supply. But a small rally in PTA futures over the past two days injected new momentum into PX and buyers were back in force.
PTA closed unchanged day-on-day at $1,158/mt CFR China for Taiwan origin cargoes. The US paraxylene price remained the highest globally at $1,447.50/mt FOB USG. The European PX price was at a nearly $25 discount to the US price.
