ASIAN PETROCHEMICALSCAN

Volume 34 / Issue 14 / April 3, 2020

Aromatics ($/mt)
FOB Korea CFR Taiwan CFR SE Asia CFR India CFR China China Domestic^
Benzene 273.83–274.83* 278.33–280.33* 239.50–240.50 FOB* 303.50–304.50
H2 Apr 264.00–266.00 -32
H1 May 270.00–272.00 -32 303.00–305.00
H2 May 270.00–272.00 -30 303.00–305.00
H1 Jun 280.00–282.00 313.00–315.00
H2 Jun 280.00–282.00 313.00–315.00
East China Domestic Marker 2913–2933
East China prompt 2880–2900
East China Bal-M1 2900–2920
East China M2 2960–2980
Sinopec Listed Price 2300
Benzene Paper Swaps:
Bal month Apr 279.00–281.00
May 285.00–287.00
Jun 286.00–288.00
Jul 286.00–288.00
Toluene 272.00–274.00 FOB* 296.00–298.00** 320.00–322.00** 342.00–344.00 301.50–302.50** 3089–3091**
303.50–304.50++
H2 Apr 271.00–273.00 281.50–283.50 FOB* 298.00–300.00**
300.00–302.00++
H1 May 272.00–274.00 301.00–303.00**
303.00–305.00++
H2 May 272.00–274.00 301.00–303.00**
303.00–305.00++
H1 Jun 272.00–274.00 303.00–305.00**
305.00–307.00++
H2 Jun 272.00–274.00 303.00–305.00**
305.00–307.00++
SOL–MX 281.50–283.50** – 341.50–343.50 CFR** 391.50–393.50++ 305.50–307.50++
ISO-MX 350.50–351.50# 368.50–369.50***
H2 Apr 340.00–342.00 358.00–360.00
H1 May 350.00–352.00 368.00–370.00
H2 May 350.00–352.00 368.00–370.00
H1 Jun 351.00–353.00 371.00–373.00
OX 449.00–451.00** 444.00–446.00 CFR** 449.00–451.00**
PX 455.33–457.33* 473.33–475.33+ 462.00–464.00+ –
H2 Apr 445.00–447.00 463.00–465.00
H1 May 448.00–450.00 466.00–468.00
H2 May 448.00–450.00 466.00–468.00
H1 Jun 459.00–461.00 477.00–479.00
H2 Jun 459.00–461.00 477.00–479.00
East China prompt 3793–3813**
Styrene 550.50–551.50 * 568.00–570.00 570.50–571.50 CFR** 550.50–551.50** 580.50–581.50++
H2 Apr 545.00–547.00 575.00–577.00
H1 May 550.00–552.00 580.00–582.00
H2 May 550.00–552.00 580.00–582.00
H1 Jun 560.00–562.00 590.00–592.00
H2 Jun 560.00–562.00 590.00–592.00
East China prompt 4930–4950
East China Bal-M1 4990–5010
East China M2 5050–5070
CPL FL 909.00–911.00
929.00–931.00 CFR FE Asia
Methanol 187.00–189.00 CFR 186.00–188.00 181.00–183.00 CFR 155.00–157.00 166.00–168.00** 1627–1629*
Methanol CP CFR Asia (APR) 260.00
MTBE 267.20–269.20 FOB Singapore MTBE factor: 1.445 –
Weekly Averages
Benzene 263.37–264.37 FOB Korea SM 505.00–506.00 FOB Korea
Benzene 296.30–297.30 CFR China SM 522.50–524.50 CFR Taiwan
Benzene 226.10–227.10 FOB SEA SM 535.00–536.00 CFR China
Benzene East China 2614–2634 China Domestic^ SM 4420–4440** East China prompt^
Toluene 277.70–279.70 FOB Korea SM 4456–4476** East China Bal-M1^
Toluene 304.00–305.00** CFR China SM 4520–4540** East China M2^
Toluene 306.40–307.40++ CFR China Methanol 171.80–173.80 CFR China
Toluene 2910–2912** China Domestic^ Methanol 195.60–197.60 CFR SE ASIA
PX 443.03–445.03 FOB Korea Methanol 1585.40–1587.40 China Domestic^
PX 461.03–463.03 CFR Taiwan/China MTBE 240.26–242.26 FOB Singapore
PX 3711–3731 East China prompt MTBE factor 1.418
Iso–MX 342.75–343.75 FOB Korea Naphtha (Apr 03) 203.25–205.75 CFR Japan
Iso–MX 360.95–361.95 CFR Taiwan
*LC at sight, **LC 0-30 days, ***0-30 days for Asia origin cargoes and 0-60 days for deep-sea origin cargoes. +LC 30-45, #LC 30 days, ++LC 90 days. Note: Paraxylene CFR assessments are basis CFR
Taiwan/China. Styrene CFR assessments are basis CFR Taiwan/China. Credit differentials calculated using 1 month LIBOR +1.5%. No balance-month assessments from 16th of each month. PTA CFR China
assessments reflect Friday’s MOC assessment. ^in Yuan/mt.

www.platts.com Now online at pmc.platts.com

ASIAN PETROCHEMICALSCAN April 3, 2020

Olefins ($/mt)
Commentaries

FOB Korea CFR Taiwan CFR SE Asia FOB Japan CFR China CFR NE Asia
Ethylene** 449–451 419–421 449–451
Propylene** 559–561 594–596 529–531 544–546 584–586
Butadiene** 439–441 479–481 429–431 479–481 499.00–501.00
Weekly Averages
Monday Tuesday Wednesday Thursday Friday Weekly Average
Ethylene CFR NE Asia 534–536 509–511 479–481 479–481 449–451 490.00–492.00
Ethylene CFR SE Asia 479–481 479–481 449–451 449–451 419–421 455.00–457.00
Propylene FOB Korea 629–631 589–591 574–576 564–566 559–561 583.00–585.00
Propylene CFR China 649–651 609–611 594–596 589–591 584–586 605.00–607.00
Butadiene CFR China 639–641 609–611 589–591 549–551 479–481 573.00–575.00
Butadiene FOB Korea 609–611 579–581 559–561 519–521 439–441 541.00–543.00
Butadiene CFR NE Asia 639–641 609–611 589–591 549–551 499–501 577.00–579.00
**LC 0–30 days, +LC 30–45, #LC 30 days, ++LC 90 days. Credit differentials calculated using 1 month LIBOR +1.5%.

Fiber Intermediates ($/mt)

CFR SE Asia CFR India CFR China China Domestic^
PTA 427–429 439–441 419–421 3250–3270
MEG++ 388–390 383–385
Weekly Averages
Monday Tuesday Wednesday Thursday Friday Weekly Average
PTA CFR China 409–411 419–421 414–416 419–421 419–421 416.00–418.00
PTA CFR India 429–431 439–441 434–436 439–441 439–441 436.00–438.00
PTA China Domestic^ 3045–3065 3130–3150 3110–3130 3215–3235 3250–3270 3150.00–3170.00
MEG CFR China 344–346 359–361 359–361 390–392 383–385 367.00–369.00
MEG China Domestic^ 2945–2965 3065–3085 3030–3050 3310–3330 3255–3275 3121.00–3141.00
^In Yuan/mt.

PET bottle and Polyester Yarn/Fiber ($/mt)

FOB NE Asia FOB SE Asia China Domestic^
PET 669–671 659–661
Polyester POY150D/48F 4700.00
Polyester DTY150D/48F 6600.00
Polyester FDY150D/96F 5200.00
Polyester PSF 1.4D*38mm 5370.00
^In Yuan/mt.

Benzene
Asia Benzene: FOB Korea down $43.67/mt on week,
prices stay below $300/mt
„„ May demand weak while supply is ample
„„ Limited tank space in East China key concern
Asia benzene prices were volatile this week, with the week starting off
at a level below $300/mt, a level that some market sources had earlier
hoped would be a price floor.
The FOB Korea benchmark stayed below $300/mt this week,
hitting the lowest point mid-week, and subsequently rising in line with
upstream crude oil prices nearing the end of the week.
FOB Korea was assessed down $43.67/mt on the week at $274.33/
mt Friday.
Traders complained of weaker-than-expected demand especially
for May-loading benzene.
Traders who had previously worked the Korea-US spot arbitrage
were heard on the sidelines for May-loading benzene, amid a
worsening COVID-19 pandemic situation there, which could further
push demand lower in the forward-months.
Furthermore, due to a 6-8 week long-haul transpacific voyage, the
supply or demand fundamentals at the time of loading from North Asia
compared to that of arrival in US waters may vary, posing large price
risks for traders.
With global April Contract Prices concluded this week, the US April
CP was concluded at 121 cents/gal, or $361.79/mt.
For cargoes to reach US in April, they would have to load from
North Asia in February, with the February Weekly Mean of Platts Korea
benchmark assessed at $657.30/mt.
In theory, the February FOB Korea WMOPK-April CP spread stands
at minus $295.51/mt.
However, market sources said that with hedging tools available in
the market, such as the Platts FOB Korea futures contract on SGX,
some risk management is possible on the FOB Korea front.
This is in line with a surge in cleared volumes on SGX in recent
months. About 120,500 mt of contracts was cleared on SGX in the
month of February.
On the other hand, demand for China is set to be weak for May-
arrival benzene, with space constraints an obstacle in the import of
CFR China benzene, despite an open import-domestic arbitrage.

© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved. 2
ASIAN PETROCHEMICALSCAN April 3, 2020

One trader noted that there was no shortage of supply in May,
citing a larger number of sellers than usual for the laycan.
With tank space limited, and only a handful of traders capable of
importing benzene in that month, supply stood greater than demand.
Furthermore, with movement of white goods and electronics slow,
demand for downstream products such as phenol and styrene were
limited, which would affect feedstock requirements by end-users.
Platts Asian Benzene Daily Rationale & Exclusions
Asia benzene was assessed up $21/mt on the day at $274.33/mt FOB
Korea Friday.
The marker takes the average of the third, fourth and fifth half-
month laycans, H1 May, H2 May and H1 June.
During the Platts Market on Close assessment process Friday, no
transparent bids or offers were seen.
The H1 May and H2 May laycans were assessed at $271/mt FOB
Korea, assessing the May/June timespread unchanged on the day at
minus $10/mt FOB Korea.
The H1 June laycan was assessed at $281/mt FOB Korea, above a
bid last seen at $280/mt FOB Korea.
The CFR China marker was assessed up $21/mt on the day at $304/
mt Friday, in line with gains in FOB Korea.
H1 and H2 May was assessed at $304/mt CFR China, tracking the
increase in FOB Korea and above earlier bids for May were seen at
$275-$285/mt CFR China.
The domestic East China marker was assessed up Yuan 450/mt at
Yuan 2,923/mt, or $356.70/mt, on an import parity basis.
Exclusions: No MOC market data was excluded from the April 3, 2020
assessment.
Platts Asian Benzene Daily MOC Bids, Offers, Trades
Trades: None
Offers: None
Bids: None
Toluene
Polymers ($/mt)
CFR Far East CFR SE Asia CFR S Asia
PVC SUSP 769–771 769–771 809–811
LDPE G–P 734–736 809–811
LLDPE Butene 639–641 699–701 719–721
LLDPE Metallocene C6 819–821 839–841 859–861
HDPE YARN 719–721 739–741
HDPE INJ 679–681 699–701 719–721
HDPE BLMDG 699–701 719–721 729–731
HDPE FILM 669–671 709–711 719–721
PP RAFFIA 679–681 769–771 839–841
PP INJECTION 679–681 774–776 839–841
IPP FILM 694–696 779–781 859–861
BOPP 704–706 799–801 869–871
BLOCK COPOL 724–726 809–811 889–891
PS G–P 839–841 869–871
HIPS 939–941 989–991
ABS INJ 1149–1151 1169–1171
For PVC, PS, ABS and C6 mLLDPE, FE Asia refers to China. All polymer assessments are basis L/C
0–30 days. Credit differentials calculated using 1 month LIBOR +1.5%.
China Domestic (Yuan/mt ex–works)
LDPE 6480–6520
LLDPE 5980–6020
HDPE FILM 6380–6420
PP RAFFIA 6080–6120
PVC ethylene-based 5190–5210
PVC carbide-based 4890–4910
Weekly averages (CFR FE Asia)
HDPE 717.00–719.00
LDPE 800.00–802.00
LLDPE 679.00–681.00
PP RAFFIA 723.00–725.00
PP INJECTION 727.00–729.00
Weekly averages (FOB Middle East)
HDPE 709.00–711.00
LDPE 792.00–794.00
LLDPE 671.00–673.00
PP RAFFIA 715.00–717.00
PP INJECTION 719.00–721.00
Note: Weekly polymer assessments are made each Wednesday for Far East Asia, SE Asia, and W
Asia. In addition, weekly averages of the daily PE and PP Far East assessments are published each
Friday and represent the average of the assessments from previous Thursday through Wednesday.

Asian Toluene: FOB Korea up $4.50/mt but

fundamentals still weak
„„ Crude jumps above $30/barrel mark
Butadiene falls 11-year low, SBR hits record-low amid
ample supplies
„„ Severe demand cut across India, Southeast Asia
($/mt)
Crude rallied from US President Donald Trump’s overnight comments 1500
suggesting a new production cut alliance may be on the cards, but the
Asian toluene market appeared to be shrugging off as participants 1200
placed more weight on weak fundamentals.
On Friday’s Asian close, FOB Korea toluene marker inched up ESBR 1502 CFR
900 NE Asia Weekly
$4.50/mt to $273/mt. June ICE Brent crude futures jumped a whooping
$4.02/barrel on-day to $30.89/b at Friday’s Asian close.
600
The most prominent signals of demand thinning out in Asia were
Butadiene CFR
the dearth of buying indications in Southeast Asia and India. China Weekly
300
India’s 21 day nationwide lockdown had abruptly stemmed out Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20
importers ability to purchase any H1 May arrival toluene cargoes. Source: S&P Global Platts

© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved. 3
ASIAN PETROCHEMICALSCAN April 3, 2020
Additionally, stocks in storages along West Coast India region were
piling up, with some trader citing logistical hurdles in offloading
cargoes at moment of writing.
Domestic price for toluene supplies from Kandla tanks were
negotiated at around Rupees 37/kg, or around $460/mt for local
independent distributors.
CFR India marker was rest at $343/mt, following trade indications
at around $70-$73/mt premiums to FOB Korea toluene marker and was
down $55.50/mt from last Friday.
Along Southeast Asia’s belt, a 4,000 mt toluene cargo for H2 April-
lifting ex-Thailand was heard changed hands at premiums in single
digit to FOB Korea toluene marker, although the trade could not be
confirmed.
FOB Southeast Asia physical was rest at $282.50/mt, on a less-
than-teens premiums to FOB Korea toluene marker.
Some sources said Vietnam’s 15-day social distancing program
would further attribute to the weakness in the region.
Other bid indications were heard around $320/mt for H1 May cargo
for ports around Indonesia, Malaysia and Singapore.
CFR Southeast Asia marker rest at $321/mt, down $55/mt
on-week. In East China, toluene inventory was around 47000 mt,
apparently smaller than when the coronavirus outbreak started.
However, buying interests from China remained weak as local
traders were cautious of stockpiling. CFR China edge $5.5/mt higher to
$304/mt on Friday.
Platts Asian Toluene Daily Rationale
Asian toluene was assessed up $4.50/mt on-day, at $273/mt for FOB
Korea, and up $5.50/mt on-day at $304/mt for CFR China on Friday.
The marker takes the average of third and fourth half-month
laycans, currently H1 May and H2 May.
No transparent bids or offers appeared during the Platts Market on
Close assessment process.
The FOB Korea May laycans and June laycans were assessed up
$4.50/mt on-day, to $273/mt, taking into consideration the afternoon
notionals and the uptick on crude between 0700-0830 GMT.
June ICE Brent crude futures rose 91 cents/barrel between 0700-
0830 GMT.
There were no bids and offers heard through the day for CFR China
market either.
The CFR China marker May and June laycans were assessed up
$5.50/mt on the day, at $304/mt and $306/mt respectively, taking into
consideration of the uptick on FOB Korea marker and uptick on
domestic China market.
The domestic China prompt ex-tank price was assessed up Yuan
345/mt, at Yuan 3090/mt, based on prompt supplies discussion range
heard around Yuan 3080-3100/mt and was equivalent to $364.84/mt
on an import parity basis, up $42.10/mt on the day.
CFR India marker was assessed at $343/mt, down $55.50/mt from
last Friday, based on trade indications for H1 May cargoes heard around
premiums of $70-$73/mt above FOB Korea toluene marker.
(Daily price assessments are found on PCA218, weekly price
assessments on PCA326)
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
China toluene, MX, styrene inventory levels
Product Inventory level (mt) Prior week (mt) Change on week (%)
East China:
Toluene 47000 44000 6.82
Mixed Xylenes 87000 95000 -8.42
Styrene 223000 225100 -0.93
South China:
Toluene 13000 12500 4.00
Mixed Xylenes 24500 20500 19.51
Styrene 40350 49500 -18.48
Asian aromatics shipping routes
Spot freight to/from Korea and USGC
From: Korea Korea USGC
To: 2-3kt 5kt 10-12kt
Korea 70-72 (SM, PX, MX)
Taiwan 23-25 (BTX, SM) 21-23 (PX) 69-74 (PX, MX)
East China 21-23 (BTX, SM) 18-21 (PX) 71-76 (SM, PX, OX)
South China 20-22 (PX)
India 63-65 (Tol)
USGC 53-57 (10kt Bz, Tol)
Spot freight from Southeast Asia
From: Pasir Gudang Map Ta Phut Singagpore
To: 3kt 3kt 2-3kt
Singapore 14-17 (Bz) 25-27 (Bz)
Indonesia 25
WC India 42
East China 37*
Taiwan 35-37 (Tol)
India 40-45 (OX)
*5-6kt.
Spot freight from Middle East
From: Middle East Middle East Middle East
To: 2-3kt 5-7kt 10-12kt
Taiwan 48
East China 54 46
India 34-36 (SM, OX) 29
Southeast Asia 41-45 (PX) 38
Spot freight from India
From: India India India
To: 3kt 5-7kt 10kt
Indonesia 32-37 (PX)
East China 47-52 (OX) 41-46 (PX) 34-38 (PX)
South China/Taiwan 32-36 (PX)
Pakistan 16-19 (PX)
Middle East 19-23 (Bz)
Unless otherwise specified, Platts liquid petrochemical assessments refer to assessed freight rates
for Benzene, Toluene, Xylenes, styrene monomer, methanol, MTBE and MEG.
Please refer to the methodology guide for details on port locations.
Asian aromatics demurrage rate ($/day)
PX demurrage China 20kt 18000.00
4
ASIAN PETROCHEMICALSCAN April 3, 2020
Solvent - MX
Asian Solvent MX: Prices plunge across the board
shrugging off crude rally
„„ China’s buying interests slowed despite smaller stockpile
„„ Paint, coating and resins industry affected across India, South-
east Asia
The Asian solvent-MX market failed to receive much of the support
from upstream crude rally, as fundamental demand in most countries
simply dwindled.
June ICE Brent crude futures inched up $4.02/barrel to $30.91/b on
Friday’s Asian close. Strong signals were showing demand thinning out
speedily in Asia as there had been a dearth of buying indications.
India’s 21 day nationwide lockdown had abruptly stemmed out
importers ability to purchase any H1 May arrival solvent-MX cargoes.
There has been logistical concerns for local importers too, as
stocks were piling up in West Coast India.
Domestic price for solvent-MX supplies from Kandla tanks were
negotiated at around Rupees 40/kg, or around $500/mt for local
individual distributors. CFR India marker slumped to $392.50/mt, falling
$47.50/mt from last Friday.
In East China, stockpile of mixed xylenes reduced to around 87000
mt this week, a significant reduction from above 110,000 mt level
during the budding times of the coronavirus outbreak.
However, bidding interests among Chinese importers had been
sluggish, as weakening global economy pinned down on China’s
businesses.
CFR China marker trimmed down $47/mt to $406.50/mt on Friday.
Likewise, the scenarios were panned out in Southeast Asia market
were equally bearish as countries in the region prepped for similar
lockdowns.
Paints, coatings and resins industries went into a stale situation
with one end-user citing at least 50% of inventory remained in storage.
CFR Southeast Asia solvent-MX tanked $52.50/mt to $342.50/mt,
as a second end-user quoted a bid indications of around $330/mt for
H1 May.
With most of Asia faced the struggles of unhealthy demand, that
pressurized the South Korea market, which witnessed quiet level of
activities.
FOB Korea solvent-MX marker eroded $47.50/mt on week to rest at
$282.50/mt.
Platts Asian Solvent MX Weekly rationale
Solvent-MX was assessed down week on week by $47.50/mt, at
$282.50/mt for FOB Korea, down $47/mt, at $306.50/mt for CFR China,
down $47.50/mt at $392.50/mt for CFR India, and down $52.50/mt, at
$342.50/mt for CFR Southeast Asia on Friday.
No transparent bids or offers appeared during the Platts Market on
Close assessment process.
June ICE Brent crude futures moved 91 cents/barrel higher
between 0700-0830 GMT. CFR Southeast Asia was assessed at
$342.50/mt, taking into consideration of the afternoon notionals and
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
Foreign exchange rates (PCA page 107)
AUD/USD AAWFT00 0.6038
EUR/USD AAWFU00 1.0805
GBP/USD AAWFV00 1.2330
USD/JPY AAWFX00 108.150
USD/HKD AAWFY00 7.7538
USD/MYR AAWGA00 4.3525
USD/SGD AAWFZ00 1.4344
USD/CNY* AAWFW00 7.1104
USD/INR AAFGW00 76.0440
*Source: Bank of China
Contract Prices ($/mt)
Paraxylene
PX average CP settlements (Apr) NA CFR Asia
ExxonMobil NA CFR Asia
Idemitsu NA CFR Asia
JXTG Nippon NA CFR Asia
S-Oil NA CFR Asia
SKGC NA CFR Asia
Reliance NA CFR Asia
PX producer CP nominations (April)
ExxonMobil 600 CFR Asia
Idemitsu 630 CFR Asia
JXTG Nippon 680 CFR Asia
S-Oil 680 CFR Asia
SKGC 680 CFR Asia
Reliance 600 CFR Asia
Sinopec CP nomination (April): 525
Sinopec CP settlement (March): 586
Sinopec CP nomination (April): Yuan 4300
Sinopec CP settlement (March): Yuan 4760
Benzene
JXTG Nippon nomination (Apr): 360
JXTG Nippon settlement (Apr): 335
MEG
Producer CP nominations (APR)
MEGlobal 640 CFR Asia
Sabic 630 CFR Asia
Shell 650 CFR Asia
the uptick in crude futures between 0700-0830 GMT, together with
bid-offer indications for H1 May cargoes at $330/mt versus $360/mt.
There were no bids and offers indications during the day for CFR
India market.
The CFR India marker was assessed at $392.50/mt, taking into
consideration of the afternoon notionals and the uptick in crude
futures between 0700-0830 GMT, together with domestic Kandla
ex-tank price heard at Rupees 40/kg, which was equivalent to around
local distributor price of $500/mt.
The CFR China marker was assessed at $307.50/mt, down $46/mt
on-week, taking into consideration the afternoon notionals and the
uptick in crude futures between 0700-0830 GMT, the movement on
domestic ex-tank solvent-MX price from Yuan 3200/mt to Yuan 3250/
mt.
There were no bids and offers indications during the day for FOB
Korea market.
5
ASIAN PETROCHEMICALSCAN April 3, 2020
The FOB Korea solvent-MX marker was assessed at $282.50/mt,
taking into consideration of the freight difference between South
Korea-China at around $24/mt.
Paraxylene
Asian PX: Falls $16.67/mt on week amid increased
volatility
„„ Market sentiment remains bearish despite gains later in the week
„„ S Korea’s Hanwha to shut 700,000 mt/year PTA plant for 2-3 days
in H1 April
Amid a rollercoaster week with double digit day-on-day price
movements most of this week, Asian paraxylene ended the week
$16.67/mt lower at $474.33/mt CFR Taiwan/China and $456.33/mt FOB
Korea Friday.
Day on day, prices rebounded $14.83/mt, in line with the surge in
crude oil futures and naphtha.
Discussions remained thin throughout the day amid the huge
volatility in oil markets, and a source noted the unclear PX market level.
While PX prices continued the general downtrend earlier in the
week, it rebounded later on gains in upstream markets but market
sentiment remained pessimistic on the lack of an upside in the
polyester chain.
Besides, as the market moves into a new month this week,
concerns around the ample physical cargoes put pressure on
sentiment as high PX and purified terephthalic acid inventories have
yet to ease, said a trader.
Sources have also noted continued delays in cargo discharge amid
high inventories and slow demand.
A China-based source said that an improvement in PX might be
tough in the short-term and a recovery would require some time.
During the Platts Market on Close process, a May cargo was traded
at $470/mt between Yisheng and Samsung C&T.
An offer for a May cargo at $478/mt from Total Trading Asia was
withdrawn shortly after the trade. A bid for an Asia-origin May cargo
was seen at $470/mt from Mercuria Singapore and was withdrawn
later.
In plant news, South Korea’s Hanwha General Chemical plans to
shut its 700,000 mt/year PTA plant at Daesan for two to three days in
the first-half of April for regular production line cleaning, a source close
to the company said Friday.
Asian PTA market sentiment remained bearish amid poor demand
as a result of the coronavirus spread.
PTA inventories are piling up, especially in China, with the overall
Chinese PTA run rates maintained at around 80%-85%, according to
market sources.
The CFR China PTA marker fell $10/mt on the week to be assessed
at $420/mt Friday.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
Platts Asian Paraxylene Daily Rationale & Exclusions
Asian paraxylene was assessed up $14.83/mt day on day at $474.33/mt
CFR Taiwan/China and $456.33/mt FOB Korea Friday.
The assessment takes the average of second-half May, first-half
and H2 June laycans.
The H2 May laycan was assessed at $467/mt, taking into
consideration a bid for an Asia-origin May cargo at $470/mt from
Mercuria Singapore which was normalized to $467/mt due to
restriction in origin.
June ICE Brent rose $1.02/b between the afternoon intraday value
and time of the trade, but fell 77 cents/b between the time of the trade
and close of the Platts Market On Close assessment process. June ICE
Brent futures rose $4.02/b from Thursday’s settle, and up 25 cents/b
from afternoon intraday value, to $30.91/b Friday at 4:30 pm Singapore
time.
Maintaining the pegged May/June spread at minus $11/mt, H1 and
H2 June laycans were assessed at $478/mt.
The May/June spread was at minus $11/mt, up 25 cents/mt on the
day, above a timespread bid from Mercuria Singapore at minus $9/mt
which was normalized to minus $12/mt due to restrictions in origin.
The above rationale applies to the following market data codes:
“PHASS05” for FOB Korea and “AAQNE00” for CFR Taiwan/China.
Exclusions: No MOC market data was excluded from the April 3, 2020,
assessment process.
(Daily price can be found on PC214, weekly assessments on PC337)
Platts Asian Paraxylene Daily Bids, Offers, Trades
Trades: 1 trade
Platts PX CFR TW-CN May20, Confirmed SAMSUNGCT BUYS FROM
HKYSDH* < P > $470.00 for 5 “NON-USA ORIGIN” (8:22:07)
Offers: Platts PX CFR TW-CN May20, OTISG offers $488.00 for 5 “NON-
USA ORIGIN”
Bids: Platts PX Asia Origin Spread CFR TW-CN May20/Jun20,
MERCURIASG < P > bids $-9.00 for 5
Isomer - MX
Asian Iso-MX: Dips $16.50-$18.50/mt on week, despite
Friday surge
„„ US cargoes expected to arrive in May-Jun
„„ China inventory shrinks
Amid surging crude oil prices on Friday, Asian isomer-grade mixed
xylene prices rose $18/mt day on day to $351/mt FOB Korea and at
$369/mt CFR Taiwan on Friday. On a week-on-week basis, prices were
down by $16.50/mt and $18.50/mt, respectively, after MX prices hit
fresh multiyear lows during the week.
June ICE Brent crude oil futures shot up $4.02/b day on day to
$30.91/b at 0830 GMT in Asian trade Friday.
One reason for low prices of MX during the week was that at least
one Northeast Asian buyer was set to receive 30,000-40,000 mt of
6
ASIAN PETROCHEMICALSCAN April 3, 2020
isomer-MX from the US Gulf over late May to early June, a source with
the buyer said on Thursday.
“We continue to check for more cargoes,” the source said.
After the onset of the coronavirus pandemic in the US, MX prices
have fallen below Asian price levels, counter to the trend seen earlier
this year, when the arbitrage from Asia to the US was open.
This led Asian MX prices to be the highest globally, despite recent
sharp price falls.
US MX hit a year-to-date low of $267.52/mt on March 24, at which
time the CFR Taiwan price was at $407.50/mt, meaning a price spread
of nearly $140/mt, and more than enough to cover freight of around
$71-$74/mt for 10,000-12,000 mt from the US Gulf to Northeast Asia,
S&P Global Platts data shows.
Meanwhile in China, East China inventory levels of MX this week
shrank again to around 85,000 mt, sources said, but several of them
also said Chinese tanks were nearly full and imports for H1 May were
difficult at the moment. Nonetheless, H2 May ex-tank prices of MX in
East China were heard late Friday at around Yuan 3,460-3,480/mt, or
about $411.20/mt on an import parity basis, after rising sharply in
Friday.
Platts Asian Iso-MX Daily Rationale
Isomer-MX was assessed up $18/mt day on day at $351/mt FOB Korea
and at $369/mt CFR Taiwan on Friday.
The markers take the average of the third and fourth half-month
laycans, currently H1 and H2 May.
No transparent bids or offers were made during the Platts Market on
Close assessment process.
During the MOC process, May was heard bid up to $350/mt FOB Korea,
against no offers. The May laycans were assessed at $351/mt, above
the bid.
No activity was heard on a CFR Taiwan basis and the marker was
assessed up in line with FOB Korea.
The above rationale applies to the following market data codes:
PHAUV00 for FOB Korea and PHAUT00 for CFR Taiwan.
(Daily price assessments can be found on PC645, weekly
assessments on PC647)
Orthoxylene
Asian Orthoxylene: Falls $35/mt as demand takes turn
for worse
„„ High volatility spooks buyers
„„ Indian PA plants remain closed
Asian orthoxylene was assessed down week on the week by $35/mt at
$450/mt CFR China as demand remains lackluster across Asia. Buy
idea on CFR China basis were this week heard below $400/mt as
downstream industry remains bearish.
Sinopec on Wednesday slashed its domestic ex-tank prices by
Yuan 500/mt ($70.70/mt) to Yuan 3,800/mt ($453.60/mt), with end-
users expecting further price decreases. “Seems no demand for
phthalic anhydride. We try to minimize our quantity for OX to buy from
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
Subscriber Notes
Good Friday publishing schedule for Platts Asia petrochemicals
The S&P Global Platts office in Singapore will be closed April 10, 2020, for the
Good Friday holiday, and there will be no petrochemicals or exchange rate
publications or assessments from Singapore on that day.
The Asian Petrochemical Scan and Asian weekly petrochemical assessments
published Fridays will be brought forward by one day to Thursday, April 9.
Additionally, Platts in Asia will close its Market on Close assessment process
early on Thursday, April 9, and all assessments will be basis 12:30 pm Singapore
time (0430 GMT). Commentaries for Asian petrochemicals published on April 9
will consist of the rationale, while the narratives and bullet points will be
suspended. Normal Singapore publishing schedules will resume on Monday,
April 13.
For full details of the Platts publishing schedule and services affected, go to
www.platts.com/HolidayHome.
For queries or comments, please contact petchems@platts.com with a cc to
pricegroup@platts.com.
Platts proposes to refine ports reflected in its CFR Southeast Asia methanol
assessment
S&P Global Platts proposes to refine ports reflected in its daily CFR Southeast
Asia methanol assessment, effective July 1, 2020.
Platts proposes to include the Indonesian port of Dumai to the basket of ports
reflected in its CFR Southeast Asia methanol assessment following Platts’
observation of increased methanol cargo deliveries to Dumai.
Furthermore, Platts proposes to reflect Port Klang, Kuantan, Dumai and
Singapore as the price basis of its CFR Southeast Asia assessment while
deliveries to all other Southeast Asian ports will be normalized to this basket of
ports applying freight differentials.
Please direct any questions or comments to petchems@spglobal.com with a
copy to pricegroup@spglobal.com by May 29, 2020.
For written comments, please provide a clear indication if comments are not
intended for publication by Platts for public viewing.
Platts will consider all comments received and will make comments not marked
as confidential available upon request.
Platts to lower CFR China Phthalic Anhydride cargo sizes effective April 8,
2020
S&P Global Platts will lower the quantity reflected in the CFR China Phthalic
Anhydride (PA) assessment from 500-1,000 mt, to 100-300 mt, effective April 8,
2020.
The decision was made, after gathering feedback from market participants, to
reflect the increase in spot trading activity for smaller parcel sizes.
The database code associated with this assessment is:
PA CFR CHINA PHAOC00
The weekly price assessments can be found on Petrochemical Alert (PCA) page
162, as well as the Asian Petrochemical Scan.
Please direct any questions or comments to petchems@spglobal.com, with a
copy to pricemethodology@spglobal.com.
For written comments, please provide a clear indication if comments are not
intended for publication by Platts for public viewing.
Platts will consider all comments received and will make comments not marked
as confidential available upon request.
Terminal nominations for Platts PX MOC
S&P Global Platts would like to remind market participants that terminal
nominations for trades published in the PX CFR Taiwan/China Market on Close
assessment process be reasonably performable within the published laycan
and should account for current infrastructure conditions.
7
ASIAN PETROCHEMICALSCAN April 3, 2020
every supplier,” a Northeast Asian end-user of OX said, adding that he
expected international prices of OX to weaken further this week.
The OX market along with many other petrochemical markets have
been heavily affected by the demand destruction occurring globally
due to the coronavirus outbreak. Earlier in the week, a seller said
buyers were cautious due to falling crude oil and “we have no bids as
of now.” Another key factor for falling prices this week is falling crude
oil and upstream prices such as isomer-grade mixed xylene. Isomer-
MX was assessed up $18/mt day on day at $351/mt FOB Korea and at
$369/mt CFR Taiwan on Friday, down by $16.50/mt week on week.
Looking at demand, Indonesia’s Petrowidada is to delay the restart
of its 70,000 mt/year phthalic anhydride plant in Gresik, East Java, to
June 1, a delay of one month amid lackluster demand and tight
feedstock supply, a company source said Thursday.
The company cut its operating rate to 50% in March and shut the
plant on Wednesday, April 1, for a month as buying interest was
hammered with the closure of many ports in Southeast Asia amid the
spread of coronavirus.
Meanwhile in India, the country’s two major PA producers,
Thirumalai Chemicals and I G Petrochemicals, may at the earliest be
able to restart their plants on April 14, the expected end-date of India’s
lockdown, sources close to the two companies said Friday.
The plants have been shut since March 28-29.
“Everything is shut in India,” one of the sources said, adding that
since the lockdown, all downstream industry has shut down.
“[There has been] no movement of goods,” one source said.
The shutdown of India’s PA plants could indirectly affect their major
supplier of feedstock orthoxylene, Reliance Industries, but so far no
reduction in run rates have been reported at Reliance.
IGPL’s total PA capacity is 222,000 mt/year at its plant site in
Maharashtra.
Thirumalai has a PA capacity of 145,000 mt at Ranipet, Tamil Nadu.
Platts Asian Orthoxylene Weekly Rationale
Asian OX was assessed down week on week by $35/mt for all three
markers to $450/mt CFR China, considering an offer for May arrival
cargo heard Friday at $470/mt, versus confirmed buy interest below
$400/mt, and also considering sharp increase in upstream crude oil
and MX prices at the end of the week.
FOB Korea was assessed at $450/mt, below selling interest heard
earlier in the week at $460-$470/mt for May cargoes.
CFR Southeast Asia was assessed down in line with the other two
markers at $445/mt, amid no disproving information.
(Weekly OX price assessments can be found on PC334)
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
Subscriber Notes (continued)
Sellers should not knowingly nominate terminals that have a high probability of
being unavailable for performance. Trades are subject to performance review
and failure to adhere to Platts editorial guidelines can lead to a review of
participation status.
Please send questions or comments to petchems@spglobal.com and
pricegroup@spglobal.com.
Labor Day publishing schedule for S&P Global Platts Asia Petrochemicals
The S&P Global Platts office in Singapore will be closed Friday May 1,2020, for
the Labor Day holiday, and there will be no petrochemical or exchange rate
publications or assessments from Singapore on that day.
All weekly assessments published on Fridays, and the Asian Petrochemical
Scan, will be brought forward to Thursday, April 30.
Normal Singapore publishing schedules will resume on Monday, May 4, 2020.
For full details of Platts publishing schedule and services affected, refer to
http://www.platts.com/HolidayHome.
For queries or comments, please contact petchems@platts.com with a cc to
pricegroup@platts.com, or support@platts.com.
Styrene
Asian styrene: Uptrend continues on rising crude
despite weak demand
„„ Crude rises $4.02/b to $30.91/b
„„ Thinner demand expected in Southeast Asia
Asian styrene surged $43/mt day on day supported by the sharp rise in
crude oil and tracking the uptrend in the domestic market.
The CFR China marker rose $34.50/mt week on week to $581/mt
CFR China Friday, after diving to a record low at $511.50/mt Monday.
In the domestic market, the prompt marker was assessed up Yuan
400/mt on the day at Yuan 4,940/mt ex-tank, equating to $602.77/mt
on an import-parity basis.
At 4:30 pm Singapore time (0830 GMT), June ICE Brent future rose
$4.02/b on the day to $30.91/b Friday.
Despite the surge in domestic styrene prices, one trader noted that
CFR China cargoes were still under pressure with limited tank storage
available in East China amid increasing operating rates heard at 65%-
70% this week.
Stockpiles at major ports in East China fell 600 mt on the week to
320,000 mt, where consumption of 25,400 mt outstripped arrivals of
24,800 mt. One source said traders struggled to secure tank storage at
ports as the built in stocks might continue until the end of April.
Demand contraction was heard this week in Southeast Asia where
downstream buyers reduced volumes purchased. Unexpected
shutdowns and scheduled turnarounds at downstream polystyrene
producers also led to a fall in regional styrene demand, forcing some
styrene producers to consider run cuts.
Meanwhile, India’s lockdown has also restrained downstream
producers from purchasing April and May arrival cargoes on
uncertainties of the coronavirus pandemic, which led to cargo
diversion to Northeast Asia where demand erosion was also expected.
8
ASIAN PETROCHEMICALSCAN April 3, 2020
Although traders were actively offering deepsea cargoes at
competitive prices, buying appetite remained thin amid ample supply
and shrinking demand.
Asian cargoes are also facing the competition from deepsea
cargoes which were closed at $421.25/mt FOB ARA and $400/mt FOB
USG Thursday.
Platts Asian Styrene Monomer Daily Rationale
Asian styrene monomer was assessed up $43/mt day on day at $581/
mt CFR China and $551/mt FOB Korea Friday.
The marker took the average of H1 and H2 May laycans. There were
no transparent bids or offers during the Platts Market on Close
assessment process. H1 and H2 May was assessed at $581/mt CFR
China, tracking the price movement in domestic China. In the East
China domestic market, the prompt marker was assessed up Yuan
400/mt on the day at Yuan 4,940/mt ex-tank, equating to $602.77/mt
on an import-parity basis. The FOB Korea marker was assessed at
$551/mt, based on the pegged $30/mt spread to CFR China, while the
CFR Taiwan marker was assessed at $569/mt, based on the pegged
$12/mt spread to CFR China.
Caprolactam
Asian Caprolactam: CFR Far East Asia falls $115/mt
„„ Demand from China expected to increase as pandemic tapers off
„„ Producers run at low rates, or shut amid weak demand
Amid the coronavirus pandemic, sentiment in the Asia caprolactam
market has plunged in line with weakness in feedstock benzene.
Several market participants were heard to have ceased buy and sell
activity with uncertainty across the petrochemical industry.
While contract price settlements for April were expected to be
announced this week, several sellers including China Petrochemical
Development Corporation and Sumitomo Chemical have opted to skip
a settlement in April. Ube Industries was heard to have concluded
April’s contract price at $950/mt.
Because demand from end-users has been slow-moving, several
producers were heard operating at “very low rates” or completely
shutting operations at production plants, resulting in no need for a
contract price.
A similar situation was heard downstream, at nylon or polyamide
6,6 units.
Market sources, however, noted an improving situation within the
Chinese market, with the coronavirus pandemic easing and the
country no longer in lockdown.
As a result, operating rates in China were heard stable over the last
two weeks at 68%, although not at a rate considered high.
Hence, domestic consumption may increase and provide some
support to demand for textile products in general.
However, with the bulk of China’s textile production for export, one
market source said that support would likely be limited as most other
key demand centers in the world were witnessing a slowdown with the
pandemic worsening ex-China.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
With India and several Southeast Asian countries on lockdown,
demand from countries outside of China is expected to stay depressed
in the short-term.
Platts Asian Caprolactam Weekly Rationale
CFR Far East Asia caprolactam was assessed down $115/mt on the
week at $930/mt CFR Far East Asia, below contract price offers for
April at $950/mt CFR Far East Asia.
CFR Southeast Asia was also assessed down $115/mt on the week
at $910/mt, tracking weakness in CFR Far East Asia.
Methanol
Asian Methanol: Prices tumble $10-$32/mt on
oversupply
„„ Limited tank space in China weighs on prices.
„„ S Korean domestic methanol demand contracts 10%-20%
An oversupply of cargoes and severe shortage of tank storage space
weighed on Asian methanol prices this week.
Traders said there was no available tank space for methanol at
Zhangjiagang and Changzhou, but there was for monoethylene glycol,
styrene monomer and benzene.
At Taicang, tank operators reduced storage space for methanol,
monoethylene glycol and gasoline, putting pressure on the methanol
market, traders added.
Middle Eastern cargoes were heard traded at parity to a 1.5%
premium to formula price this week.
As for fixed-priced offers, a 20,000-mt non-sanctioned parcel was
offered at $185/mt CFR China at the start of the week, but moved
down to $177/mt CFR China on Friday.
A buyer was keen on purchasing the cargo at a much lower price,
but was hampered by a lack of tank space, he said.
Meanwhile, downstream industries in East China such as
formaldehyde, plywood and superplasticizer reported slow sales for
April and May, because of export restrictions, canceled export orders,
and poor domestic demand for household appliances due to the
coronavirus pandemic.
“A 700,000 dwt vessel loaded with formaldehyde was sent to the
largest superplasticizer factory in China, which usually takes only one
day to unload, but it took 12 days because the receiver had lots of
inventory in its tanks,” said a trader.
Superplasticizer is used as an additive in high-strength concrete.
However, China’s construction sector has slowed recently dampening
demand, said trade sources.
In South Korea, small and medium-sized end-users planned to
decrease demand by 10%-20% this month. As such, traders and end-
users have reduced their term contract volumes to a minimum.
South Korean ex-tank prices fell Won 10/kg on the week to Won
320/kg (26 cents/kg), said traders.
Fundamentals were similarly bearish in Southeast Asia with
Malaysia in a lockdown till April 14 and slowing petrochemical and
biodiesel demand in Indonesia.
9
ASIAN PETROCHEMICALSCAN April 3, 2020
Platts Asian Methanol Daily Rationale
Asian methanol fell $6/mt day on day and $9/mt week on week to
$167/mt CFR China Friday, below an offer at $177/mt CFR China amid
weak downstream demand and an oversupply of cargoes arriving in
April and May.
The contango structure for the market, a severe shortage of tank
storage space in April and May, and market feedback that tradable
levels for April 23-May 23 was $165-$170/mt CFR China, were also
taken into consideration for the assessment.
Prompt spot ex-tank prices rose Yuan 13/mt on the day to Yuan
1,628/mt ex-tank Friday, amid discussions heard at Yuan 1,625-1,630/
mt ex-tank as methanol futures traded higher on Friday, tracking
firmer crude oil futures.
CFR Southeast methanol was assessed $7/mt lower day on day
and $32/mt lower week on week at $182/mt CFR Friday, below an offer
at $185/mt CFR Southeast Asia, reflecting weak supply fundamentals
for April and May.
South Korean methanol prices fell $32/mt on the week to $188/mt
CFR Friday, under an offer at $190/mt CFR Korea amid bearish market
fundamentals.
The CFR Taiwan marker was assessed at $187/mt on Friday, down
$11/mt on the week, amid muted discussions, reflecting a $21/mt
spread to CFR China methanol prices and weak downstream demand.
(Weekly price assessments are found on PCA348, daily price
assessments are found on PCA653)
MTBE
Asia MTBE: MTBE closes higher by $20.70/mt on week
„„ MTBE reflects more bullish sentiment than petrochemical mar-
kets
„„ 92 RON-Brent crack further narrows to minus $8.94/b
The Asia MTBE FOB Singapore benchmark was assessed up $16.10/mt
day on day, and up $20.70/mt week on week, at $268.20/mt Friday.
Unlike the week-on-week fall in most petrochemical markets,
MTBE moved up on the week, closely tracking the front-month ICE
Brent crude oil futures in gasoline.
June ICE Brent crude oil futures were assessed up $4.02/b day on
day, and up $5.12/b week on week, at $30.91/b at 0830 GMT Asian
close Friday. For the first time in more than two weeks, prices closed
above $30/b.
Despite the bullishness on ICE Brent, gasoline price gains lagged
that of the crude, resulting in a further narrowing of the 92 RON-Brent
crack, which has been negative this week.
The 92 RON-Brent crack was assessed at minus $8.94/b, down
43% day on day, reflecting poor demand for gasoline amid the ongoing
COVID-19 pandemic which has limited travel both within and between
countries.
Platts Asian MTBE Daily Rationale & Exclusions
Asian MTBE was up $16.10/mt day on day at $268.20/mt FOB Singapore
Friday.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
During the Platts Market on Close assessment process, no
transparent bids or offers were registered. The MTBE factor was
assessed at 1.445 Friday, unchanged from 1.445 Thursday.
Given 92 RON gasoline prices, up 6% day on day, the FOB Singapore
MTBE marker, which takes into account cargoes loading 15-40 days
forward, currently April 8-May 13, was assessed at $268.20/mt FOB
Straits, up 6.39% over the same period.
Exclusions: No MOC market data was excluded from the April 3, 2020
assessment.
Platts Asian MTBE Daily Bids, Offers, Trades
Trades: None
Offers: None
Bids: None
Ethylene
Asian ethylene: Steady but sentiment still bearish
„„ Downstream prices rebound
„„ Japan exports down by 9% YoY
A trader said buying interest may recover from Northeast Asia buyers
amid downstream styrene and monoethylene glycol prices picking up.
However, the buying indication heard at below $450/mt, which was not
increased given lowered naphtha price.
In Southeast Asia, buying interest remained poor, a handful of
buyers have limited required amid the uncertainty of downstream
demand, lockdown is expected, as result, the buyers are trying to
control inventory for feedstock ethylene in low position to avoid any
risk.
Asian styrene rallied $13/mt on the day $538/mt CFR China and
$508/mt FOB Korea Thursday, tracking the surge in the domestic
China market and uptick in crude oil.
Asia MEG was up by $31/mt on the day at $391/mt CFR China, S&P
Global data shown.
In custom static news, Japan ethylene export volume for February
in 2020 stood at 50,341 mt, up by 11% MoM and down by 9% from the
same period of time in 2019 at 55,451 mt, according to Japan Custom
data.
Platts Asian Ethylene Daily Rationale
Asian spot ethylene prices were assessed down by $30/mt day on day
and lower by $90/mt week on week Friday at $450/mt CFR Northeast
Asia, in line with market discussions at $450/mt, below selling
indication at $500/mt.
An offer was heard at $470-$480/mt CFR Northeast 6,500 mt for
H2 April/H1 May arrival, however, the offer was excluded from
assessment as it was not within the assessed parcel size.
CFR Southeast Asia price was assessed down by $30/mt on the
day and lower by $105/mt week on week at $420/mt, above buying
indication at $400/mt and a tradable value from a buyer at $410/mt, in
line with the market discussion heard at $410-$430/mt.
10
ASIAN PETROCHEMICALSCAN April 3, 2020
FOB Korea was assessed lower by $90/mt at $450/mt week on
week, tracking same trend with CFR Northeast Asia amid muted
discussion.
(Daily price assessments are found on PCA550, weekly price
assessments on PCA302).
MEG
Asia MEG: Tumbles on high inventories
„„ Inventories over 1.3 mil mt
„„ MEG imports in China fall
Asian monoethylene glycol prices rose Friday amid a slight tightening
in supply and an improvement in buying sentiment due to an uptick in
crude oil futures.
Domestic China MEG parcels for prompt loading traded at around
Yuan 3,265/mt ex-tank, equating to $373/mt CFR, on an import parity
basis after deducting Yuan 100/mt for road deliveries.
Prices of downstream polyethylene terephthalate bottle chips fell
$30/mt on the week to $670/mt FOB NE Asia.
The market was in contango, with May parcels discussed at a
slightly higher price than prompt deliveries.
Chinese inventories were at an all-time high of 1.375 mil mt,
according to market sources. Operating rates of China plants were
reported at an average of 72%, while coal based MEG plants were
heard operating at rates of around 50%, according to market
observers.
Although Chinese companies could now apply for tax exemption
for US MEG, subject to government approval, few traders were heard
doing so as they said they had many near term offers at hand. In
addition, most market participants preferred to deal on a near term
basis, given market uncertainty.
Europe MEG was last assessed at $493/mt CIF Northwest Europe,
up $33/mt on 27 March. Despite the high prices, traders said the
China-Europe arbitrage was closed due to the extremely weak demand
on the back of lockdowns in the continent. Chinese MEG trade volumes
showed a general downtrend for both imports and exports in January
and February due to the Lunar New Year holidays and the coronavirus
pandemic, according to recently released data by the China Customs
Statistics Information Center. Imports for the two months totaled
1,688,494 mt, down 1.6% on month, due to weak demand.
Platts Asian MEG Daily Rationale
Asian monoethylene glycol was assessed $7/mt lower day on day at
$384/mt CFR China Friday, for 15-30 days forward cargoes of standard
1,000 mt parcel size with 90 days letter of credit, on price discussions
reported at $383-$385/mt CFR at the close of the market.
China’s domestic MEG price was assessed Yuan 55/mt lower over
the same period at Yuan 3,265/mt ex-tank, with deals heard at Yuan
3,230-3,300/mt for prompt loading.
The CFR Southeast Asia market was assessed at $389/mt Friday,
up $12/mt week on week, reflecting weekly increases in the China
domestic market and maintaining a $5/mt premium to CFR China.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
Propylene
Asia Propylene: Down $60-80/mt on week as COVID-19
continues to hit demand
„„ East China propylene down Yuan 200/mt on day
„„ Oriental Energy restart Zhangjiagang PDH plant Friday
The propylene market in Asia tumbled this week, as buyers showered
stiffer resistance towards spot procurement amid general bearish
sentiment owing to the spread of coronavirus.
East China propylene stood at Yuan 5,000/mt ex-tank, down Yuan
200/mt on the week.
A propylene producer in China said that domestic producers have
lowered their price offer to entice buying given the recent price fall for
the propylene imports.
“The Chinese refinery have increase their operating rate lately and
they are lowering the price offer for propylene to attract Chinese
buyers who are eyeing imports which is cheaper and growing in
abundance,” said the Chinese producer.
The price spread between polypropylene and propylene was
calculated at $95/mt Friday, way below the typical break-even spread
of $150/mt, according to S&P Global Platts data.
Demand was reported even weaker in SEA, as the lockdown among
many countries in SEA decimated buying interest
“The market is very bad, there is lockdown in India and almost all
the countries,’ said a spot buyer in India.
In plant news, China’s Oriental Energy restarted a year propane
dehydrogenation plant at Zhangjiagang in eastern China’s Jiangsu
province Friday after it was shut down in early March for a month-long
planned turnaround, a company source said.
The company also restarted its downstream, 400,000 mt a year,
polypropylene plant Friday, the source added.
“We are starting our PDH plant now, we should be able to produce
at full capacity by early next week,”
The plant has the capacity to produce 660,000 mt/year of
propylene and uses 790,000 mt/year of propane as feedstock when
operating at 100% of capacity.
Platts Asian Propylene Daily Rationale
Propylene was assessed down $5/mt at $585/mt CFR China on Friday,
above a tradable indication heard at $580/mt CFR China from a buyer.
The FOB Korea price was assessed down $5/mt at $560/mt FOB
Korea, lower than selling indication heard at $600/mt FOB Korea from
Korean producer , above a buying indication heard at $500-$550/mt
FOB Korea from buyers.
The domestic Shandong price was assessed unchanged on day at
Yuan 5,150/mt with tradable indication heard at Yuan 5,150/mt ex-tank
and the domestic east China price was assessed down Yuan 200/mt
on day at Yuan 5,000/mt ex-tank on with tradable indication heard at
Yuan 5,000/mt ex-tank
The CFR Taiwan price was assessed down $60/mt week on week
at $595/mt, higher than a tradable indication heard at $580-$590/mt
CFR Taiwan from buyers
11
ASIAN PETROCHEMICALSCAN April 3, 2020
The CFR Southeast Asia marker moved down $80/mt over the
same period to $530/mt, above a tradable indication heard at $520/mt
CFR SEA from a buyer.
FOB Japan was down $65/mt week on week at $545/mt FOB
Japan, maintaining the price spread of $40/mt with CFR China.
Butadiene
Asian Butadiene: Dives $50-$80/mt amid ample
supplies
„„ CFR China hits lowest level since January 2009
„„ No bottom seen for Asian butadiene
Asian butadiene prices dived in the range of $50-$80/mt on Friday,
with CFR China price sinking to its lowest level since January 2009,
dragged down by ample supplies.
On a week-on-week basis, Asian butadiene marked a $140-$170/mt
decline.
Asian butadiene started this week with a bearish note, hit by
persisting influx of deepsea cargoes from Europe and the US.
Earlier this week, a 5,000 mt spot cargo from the US was heard to
have been traded to South Korea for June arrival. The cargo was fixed
partly on a formula based and fixed pricing.
Regional supplies are also seen to be increasing this week. Later
this week, an offer at $530/mt CFR Korea was also rejected.
From Japan, spot butadiene cargoes are seen to be available amid
lower synthetic rubber plant operations.
On Friday, a spot cargo was heard to have been done at $420/mt
CFR China for early May arrival. But a confirmation from a buyer was
unavailable.
In Southeast Asia, Malaysia’s Lotte Chemical Titan issued a tender
to sell a 2,000 mt butadiene cargo for April 16-30 loading from Pasir
Gudang. The tender is due to close on April 3.
ASIAN PETROCHEMICALSCAN
ISSN: 1931-177X
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© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved. 12
Some market sources said demand for the tender maybe limited,
considering the current heavy supplies.
In China, local market price continued lower hitting at a record-low
of Yuan 4,000/mt on Friday, or $488/mt on an import parity basis.
China’s butadiene suppliers tried selling their high inventories amid
lower downstream plant operations.
On Friday, CFR Northeast Asia styrene-butadiene-rubber price
dropped $50/mt week on week to hit a record-low of $1,030/mt,
according to S&P Global Platts data.
Looking forward, market sources said it is unclear when the
bottom of Asia butadiene market is as heavy supply situation would
likely continue as spreading COVID-19 would continue to slash
downstream factories, notably automobiles.
On Friday, western crude oil futures rebounded, jumping $4.02/
barrel day on day to be assessed at $30.91/b at 4:30 pm Singapore
time (0830 GMT). But the rebound did not support Asian butadiene
market.
Market sources said supply cut — such as lower steam cracker
operations — is necessary to stop the current decline in Asian
butadiene prices.
Platts Asian Butadiene Daily Rationale
CFR China butadiene price sank $70/mt day on day to be assessed at
$480/mt Friday, below a selling indication heard at $490/mt CFR China.
CFR Northeast Asia butadiene price fell $50/mt to $500/mt during
the same period, lower than a selling indication heard at $530/mt CFR
Korea.
Meanwhile, FOB Korea butadiene price dropped $80/mt from
previous day to $440/mt Friday in line with falling NE Asia/China
markets.
On a weekly basis, CFR Taiwan butadiene price dropped $160/mt
week on week to be assessed at $480/mt Friday, while CFR Southeast
Asia price also sank $170/mt to $430/mt during the same period, in line
with NE Asia markets.
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ASIAN PETROCHEMICALSCAN April 3, 2020
PVC
Asian PVC: Falls $30/mt amid lockdown
„„ CFR China hits lowest since March 2016
„„ Ethylene-based PVC touches record low
Asian PVC fell $30/mt week on week Wednesday, with CFR China price
sinking to the lowest since March 2016.
Several cancellations were heard as some countries in Asia — such
as Malaysia or India — are currently shut in a bid to stop spreading
coronavirus.
Ongoing lockdown in India particularly hit Asian PVC market as the
country needs to import 2 million mt annually. Amid the lack of PVC
demand in India, PVC sellers were dumping their cargoes to China, the
only PVC consumer country which is currently open in Asia.
Some trading sources said certain PVC sellers were rumored to
have sold their cargoes below $700/mt CFR China. For April, PVC was
settled at $800/mt CFR China.
“Actually the current market is practically paralyzed, except China.
Therefore, all the major suppliers are trying to plunge into the Chinese
market, which rapidly turns the balance to oversupply,” said a market
source.
Exports from China were also limited due to bearish demand in
India, which made domestic supplies in China ample.
On Wednesday, ethylene-based PVC price was assessed at a record
low of Yuan 5,200/mt, down Yuan 1,100/mt from the previous week.
Carbide-based PVC price plunged Yuan 950/mt from last Wednesday
hovering at Yuan 4,900/mt Wednesday.
Some market sources said China’s carbide-based PVC is currently
suffering from high production cost pressure compared to ethylene-
based PVC. They said currently, ethylene-based PVC producers are
more cost competitive compared to carbide-based PVC amid plunging
ethylene feedstock cost.
On Wednesday, the CFR Northeast Asia ethylene price fell to the
lowest level since May 2009.
Asian PVC market was also under pressure amid plunging western
crude oil futures. June ICE Brent futures sank $5.20/b week on week to
be assessed at $24.88/b at 4:30 pm Singapore time (0830 GMT)
Wednesday.
Looking forward, some market sources said an initial offer for May
would likely be slashed more than $100/mt, considering the current
lockdown situation.
Platts Asian PVC Weekly Rationale
Spot prices fell $30/mt week on week Wednesday, dragged down by
bearish sentiment amid falling domestic market in China.
CFR China PVC price fell $30/mt week on week to be assessed at
$770/mt, while CFR Southeast Asia PVC price was down $30/mt to
$770/mt during the same period.
Meanwhile, CFR India PVC price dropped $30/mt from the previous
week to be assessed at $810/mt Friday.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
LDPE
Asia LDPE: Plunges on lower offers
„„ Extremely weak finished goods demand due to lockdowns
„„ Malaysia’s Lotte plans PE restart in Apr
Asian LDPE prices plunged on Wednesday due to weak demand
stemming from decreased downstream operations due to the
COVID-19 outbreak.
Demand for finished goods were down as a result of lockdown
measures by governments across the globe to control the spread of
COVID-19.
Traders held on to Qatari cargoes were heard offering at $735/mt
CFR China.
Some traders viewed the current market situation as an
opportunity, but noted the long market recovery, high inventory rental
and financing cost as a barrier.
The strengthening of the US dollar against key Asian currencies in
March was putting prices in Asia under extreme pressure, as the
coronavirus pandemic had already triggered a global recession.
Most Asian petrochemical producers procure feedstock and
condensate imports in US dollars, and the strong dollar is putting
pressure on companies with high debt ratios, one trader said.
As local currencies weaken against the US dollar, buyers are
increasingly opting for domestic over imported cargoes.
High inventories in China were also discouraging imports, market
sources said. In Southeast Asia, traders said payment delays were
starting to occur from small end-converter enterprises and fears of
defaults were growing.
Other end-users were struggling to complete deals as they had
borrowed the funds for their US dollar purchases at higher interest
rates.
In Pakistan, some Middle east offers were heard at $780/mt CFR
for LDPE at $800-$890/mt CFR. In India, producer inventories were
building up but there were no sales anticipated until after the lockdown
ends on April 15, sellers said. Indian converters said they preferred to
buy next week, closer to the end of the nationwide lockdown to assess
the situation.
In plant news, Malaysia’ s Lotte Chemical Titan plans to restart its
230,000 mt/year low density polyethylene unit, 115,000 mt/year
bimodal high density polyethylene plant, 480,000 mt/year
polypropylene facility after two to three weeks of maintenance at Pasir
Gudang, during the planned turnaround of its No. 2 naphtha-fed
stream cracker in April, a company source said.
The exact restart dates has yet to be decided, the source added.
During maintenance, the 430,000 mt/year No.1 naphtha-fed
cracker was operating as per normal.
The No. 1 steam cracker can produce 260,000 mt/year of ethylene,
160,000 mt/year of propylene, and has a 220,000 mt/year downstream
HDPE/linear low density PE swing plant, which is currently producing
just HDPE, the source said.
The company also operates a 450,000 mt/year PE plant consisting
of three facilities with 125,000 mt/year, 125,000 mt/year and 200,000
13
ASIAN PETROCHEMICALSCAN April 3, 2020
mt/year capacities at Merak, Cilegon in Indonesia, which continues to
operate using feedstock purchased from the market.
Once the new naphtha-fed steam cracker, with an ethylene
production capacity of 1 million mt/year, is added to its petrochemical
facility in Merak, Banten province, Indonesia, by 2023, the plant will no
longer need ethylene imports, the source added.
Platts Asian LDPE Weekly Rationale
Asian LDPE, with a melt flow index of 0.3-4, but typically between 1 and
2, was assessed at $735/mt CFR Far East Asia (China) on Wednesday,
plunging $105/mt on the week, on discussions for a Middle east cargo
at the same number.
The CFR Southeast Asia (Vietnam) marker was assessed at $810/
mt, down $60/mt on the week, below an offer at $820/mt CFR
Vietnam.
Domestic LDPE Chinese prices were assessed at Yuan 6,500/mt
ex-works, down Yuan 400/mt on deals concluded at the same level.
LLDPE
Asia LLDPE: Falls on lackluster demand
„„ DCE falls Yuan 345/mt on week
„„ Haldia to keep PE units shut till lockdown
Asian LLDPE prices were down due to lower discussions on sagging
crude and the drastic falls in futures on the week.
May ICE Brent crude oil futures fell $2.63/b on the week to
$24.88/b at 4:30 pm Singapore time Wednesday (0830 GMT). Many
producers adjusted their April monthly offers lower, taking into
account the slump in energy prices seen thus far in March as well as
the wider demand destruction from the COVID-19 lockdowns.
Actively traded May 2020 LLDPE futures on the Dalian Commodity
Exchange plunged Yuan 555/mt on the week to settle at Yuan 5,565/mt
ex-warehouse by Wednesday close.
End converters pointed to the current raw material naphtha levels
of below $200/mt CFR Japan, and did not purchase as they thought
polymer prices had room to fall further.
Sources were hoping China central bank stimulus would boost
domestic consumption, which accounts for 80% of total PE demand.
Asian PE margins improved, due to falling feedstock prices. In
Malaysia, many converters had shut for the safety of their workers, and
were leaving cargoes at ports to be cleared after the Restriction of
Movement ends in mid-April.
In downstream demand, consumer applications requirements and
agricultural film for PE in China were heard to be revived.
Although some plastic manufacturers had recovered some of their
production, the coronavirus outbreak in Europe and US affected their
finished goods exports, they said.
Observers said the PE demand lost from entertainment packaging
would not be replaced.
In India, polymer resin were not being cleared by customs as they
were not essential goods in the country’s lockdown. In plant news,
India’s Haldia Petrochemicals will keep its steam cracker and polymer
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
units shut until the lockdown is lifted in the country, a company source
said Wednesday.
“So far government has ordered shutdown until April 14. It might be
extended,” the source said. The plant was shut early last week due to
low demand.
The company’s steam cracker in Haldia is able to produce 670,000
mt/year of ethylene, 425,000 mt/year of propylene and 97,000 mt/year
of butadiene. The steam cracker supports 550,000 mt/year high
density polyethylene, a 150,000 mt/year HDPE/LLDPE swing plant and
a 340,000 mt/year polypropylene unit. South Korea’s LG Chem plans to
maintain the operating rate of its steam crackers in Daesan and Yeosu
at full capacity in April, a company source said Thursday.
Asian steam crackers have been on the fence about adjusting run
rates down in line with the global economic slowdown due to the
coronavirus pandemic, which has already impacted downstream
demand.
The company had first raised run rates to 100% on March 7
following the shutdown at Lotte Chemical’s Daesan plant, company
sources said.
Platts Asian LLDPE Weekly Rationale
Asian butene-grade LLDPE with a melt-flow index of 1-2 was assessed
at $640/mt CFR Far East Asia (China) Wednesday, down $60/mt on the
week, on a cargo discussed at the same level.
The CFR Southeast Asia (Vietnam) marker was assessed down
$60/mt at $700/mt, below an offer heard at $760/mt CFR. There were
no bids heard as the country was under a lockdown for the next two
weeks. South Asia (India) was assessed at $720/mt, down $60/mt,
above a buy idea at $710/mt CFR.
Dutiable C6 mLLDPE was assessed at $820/mt CFR FEA, down
$60/mt, considering typical spread of $150-180/mt above the C4 LLDPE
grade. No discussions were heard. Southeast Asia was assessed at
$840/mt CFR, down $60/mt, reflecting a typical spread of $20/mt
between Northeast and Southeast Asia. MLLDPE was assessed at
$860/mt CFR S Asia, down $60/mt reflecting a typical spread of $40/
mt from Northeast Asia.
Domestic Chinese cargoes were assessed at a traded level of Yuan
6,000/mt ex-works in east China, down Yuan 350/mt on the week.
HDPE
Asia HDPE: Plunges on lower offers due to falling
crude
„„ IOC runs polymer units at 50%
„„ Restricted container movements due to COVID-19 outbreak
Asian HDPE prices fell to a 17-year-low amid sluggish demand in the
wake of the coronavirus outbreak on Wednesday.
Producers were facing accumulating inventories as goods cannot
be delivered to converters as transportation was paralyzed under
lockdowns.
14
ASIAN PETROCHEMICALSCAN April 3, 2020
Some ports and warehouses remained open, but faced
significantly reduced manpower and goods unloaded were not
reaching converter warehouses because of land travel restrictions.
Market sources said buying almost came to a halt, as a result of
the uncertainty about demand for some segments, particularly those
that depend on the economy that have been shut down by the
lockdowns.
Suppliers struggled to find outlets for their product and a highly
competitive environment emerged in those regions with minimal
restrictions on downstream manufacturing activities.
In addition, although demand for flexible packaging has been
strong, one that had been boosted by grocery and food stockpiling in
March, demand was only a temporary spike, sources said.
Containers were heard lying empty in some countries after
unloading, some observers said, with ship-owners unwilling to move
empty containers to where there was demand as they will be facing
further losses.
Most converters were factoring more time into the sale of goods,
given the logistics difficulty and lack of containers.
Lockdowns aimed at halting the spread of coronavirus had closed
Asian polymer conversion capacity in Vietnam, Malaysia, India,
Philippines, and Thailand in the first half of April as converters risk
losing manpower to self-isolation or illness, according to sources.
The coronavirus border restrictions have already made the task of
shipping polymers more complicated and thus more expensive as
deliveries take longer or are delayed, but converters worry the spread
of the illness could risk business or operational continuity in April.
Some sources pointed to terminal operators enforcing manpower
changes that stymied or limited the logistical capacity of companies
by imposing a halving of their logistical capacity and thus doubling the
time taken to process deliveries.
Some traders said Middle East capacity might be reduced due to
movement restriction imposed by governments and less manpower
for operating the plants.
Delays were expected in new steam cracker startups, sources said.
Despite recent recoveries in domestic demand, China polymer
operating rates set to remain low amid weak export markets. In India,
trading came to a halt as the government ordered a complete
lockdown.
Only essential goods, which did not include plastic resin, were able
to be cleared from customs.
Some importers were trying to postpone or cancel shipments for
unshipped cargoes since port clearance was not possible under the
current lockdown or ask for free storage for the cargoes that had
reached ports.
Some traders said some payment defaults were starting to appear
from the small end converter enterprises.
Other traders said with the devaluation of the Asian currency
against the US dollar, this made imports expensive.
All customers continue to adopt a wait and see approach, on the
back of expectations price would fall for all polymer grades. In
Pakistan, some Middle East offers were heard at $780/mt CFR for
HDPE.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
In plant news, Indian Oil Corp. is operating its 350,000 mt/yr HDPE/
LLDPE swing plant, a 300,000 mt/year HDPE plant and a 600,000 mt/
year polypropylene plant in Panipat, Haryana, at 50% due to low
demand during the nation’s lockdown, a company source said.
It was unknown when demand might return, the source added.
Platts Asian HDPE Weekly Rationale
Dutiable unimodal film grade HDPE with a melt flow index of 0.07-0.18
was down $80/mt on the week at $670/mt CFR Far East Asia (China)
Wednesday, on a discussions for a Middle East cargo at the same level.
Film grade was assessed at $710/mt CFR SE Asia (Vietnam), down
$80/mt CFR, below an offer at $780-790/mt CFR. There were no buying
ideas heard as the country was under a lockdown. HDPE film grade
was assessed at $720/mt CFR S Asia, down $70/mt in between a buy
idea at $600/mt and an offer at $780/mt CFR.
Injection grade HDPE was assessed at $680/mt CFR FE Asia
(China), down $60/mt, on discussions heard at the same level.
Injection grade HDPE was assessed at $700/mt CFR SE Asia, down
$60/mt reflecting a typical spread of $20/mt between Northeast and
Southeast Asia. Injection grade was assessed at $720/mt CFR S Asia,
down $50/mt considering a typical freight differential of $40/mt from
Northeast Asia.
HDPE blow molding grade was assessed down $60/mt at $700/mt
CFR Far East Asia above a buying idea at $690/mt CFR. Blow moulding
was assessed at $720/mt CFR SE Asia (Vietnam), down $60/mt,
reflecting a typical spread of $20/mt between Northeast and
Southeast Asia. Blow moulding was assessed at $730/mt CFR S Asia,
down $60/mt on nonexistent demand during lockdown and reflecting
the downtrend in broader markets.
HDPE yarn grade was assessed down $60/mt at $720/mt CFR FE
Asia (China) on discussions heard at $720-780/mt CFR. Yarn grade was
assessed at $740/mt CFR SE Asia (Vietnam), down $60/mt reflecting a
typical spread of $20/mt between Northeast and Southeast Asia.
Domestic HDPE Chinese cargoes were assessed at Yuan 6,400/mt
ex-works, in East China, down Yuan 400/mt week on week as cargoes
traded at the same level.
(Price assessments are found on PCA274)
PP
Asian PP: Tumbles $100/mt to record low on weak
fundamentals
„„ Sellers targets China amid weak demand in other regions
„„ SE Asia sellers and buyers adopt wait-and-see approach
Asian polypropylene prices tumbled by $100/mt week on week to
$680/mt CFR Fareast Asia, hitting a record low since Platts started
assessing the marker on October 17, 2011.
In China, the overall run rate of the PP production was heard at
around 89% of the total capacity, a trader said.
Even though the demand remained weak in China, the healthy
profit pushed PP producers including Sinopec to postpone
maintenance that was initially scheduled in April, the trader added.
15
ASIAN PETROCHEMICALSCAN April 3, 2020
Some South Korea and Middle East PP producers had started
lowering their offers to below $700/mt CFR China this week, under the
pressure of cheap Southeast origin cargoes seen since early last week.
Poor demand in Southeast Asia and South Asia regions forced
most producers to target China market instead, resulting in faster fall
in PP prices in China compared with other Asian regions.
East Chinese domestic prompt PP was assessed at Yuan 6,100/mt
ex-works, equivalent to around $700/mt CFR China or dutiable
cargoes.
Asian PP market structure remained backwardated, hence buying
indication for 20-40 day forward cargoes was generally lower than
prompt China domestic cargoes.
In Southeast Asia, customers generally purchased on a need-to
basis and preferred local prompt cargoes due to logistics challenges
surfaced in some countries.
Vietnam domestic cargoes were heard traded at around $770-
$780/mt early this week, and as low as $730-$750/mt in mid of the
week.
“If no one [oversea producer] matches the buying idea of $730-
$740/mt [CFR Southeast Asia for raffia grade], customers are ready to
wait for the price to fall further next week,” a trader said.
Nevertheless, some sellers continued standing firm on offer of
$800/mt CFR Southeast Asia and above.
“We are not interested in this [bidding] level now. We expect a
buying window to open by end of next week [for replenishment],” a
producer based at Southeast Asia said.
Separately, Vietnam Hanoi and Ho Chi Minh cities had implemented
stricter rules to contain the coronavirus outbreak, including a halt on
Inter-city transport, a stop to public gatherings and temporarily shut
down of non-essential services until April 15 at the earliest.
In South Asia, physical spot discussions were limited amid 21-day
nationwide lockdown in India.
Despite low crude oil price, the unit cost of PP production had
actually increased for Indian PP producers who were running refinery
and PP plants at lower operating rate, a source said.
Platts Asian PP Weekly Rationale
Asian raffia-grade polypropylene was assessed down $40/mt day on
day, or down $100/mt week on week, at $680/mt CFR Far East Asia on
Wednesday, in between offers of $680-$900/mt and buying indication
of $650-$680/mt.
A deal was heard concluded at $670/mt, yet excluded from
assessed Wednesday, as some market participants including
producers and traders deemed the deal unrepresentative, given that
the traded price was much lower than the import parity of domestic
Chinese prices.
Injection-grade PP was assessed down $45/mt on day, or down
$105/mt on week, at $680/mt CFR Far East Asia, in between offers of
$680-$900/mt and buying indication of $650-$680/mt, following raffia
grade marker.
East China domestic prompt price was assessed flat day on day, or
down Yuan 350/mt week on week, at Yuan 6,100/mt, reflecting a
tradable discussion heard at this level.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
Isotactic PP was assessed at $695/mt CFR FE Asia, down $100/mt
week on week, considering a typical price differential of $10-$20/mt to
the base raffia grade.
Biaxially oriented PP was assessed down $100/mt week on week at
$705/mt CFR FE Asia, following adjacent marker.
Block copolymer was assessed down $100/mt week on week at
$725/mt CFR FE Asia, below offers of $750-$940/mt for dutiable
cargoes.
A deal was heard closed at $750/mt, yet for non-dutiable cargoes.
In Southeast Asia, PP raffia was assessed down $55/mt week on
week at $770/mt CFR for dutiable cargoes, above buying indication of
$730-$740/mt, below offer of $800/mt, reflecting tradable discussions
heard at $750-$790/mt for dutiable cargoes.
PP BOPP was assessed down $55/mt on week at $800/mt CFR
Southeast Asia for dutiable cargoes, above the buying indication of
$750/mt, following adjacent marker.
In South Asia, raffia was assessed $30/mt lower at $840/mt CFR,
below offer of $870/mt and above buying indication of $800-$830/mt.
Weekly PP price assessments can be found on <PCA282>
PS
Asian PS: Falls $30-$50/mt on weaker demand
„„ Widespread lockdowns slash PS demand
„„ China’s PS imports drop in Jan, Feb
Asian general purpose polystyrene fell $30/mt on the week to $840/mt
CFR China and fell $50/mt to $870/mt CFR Southeast Asia.
Asian high-impact polystyrene also moved down by $30/mt on the
week to $940/mt CFR China and $990/mt CFR Southeast Asia
Wednesday.
Amid market uncertainties and volatility, tradable indications were
more flexible than before, said a polystyrene producer.
While some customers wanted to secure materials at the current
low prices, others were not keen to stock up, awaiting prices to decline
further.
Restrictions on physical movement and logistic constraints in
many countries have forced customers to postpone or cancel orders,
said an EPS producer. Demand was worse this week as many countries
have lockdowns to curb the spread of the coronavirus, added the
source.
According to market sources, Vietnam has implemented a 15-day
social distancing clampdown to fight against the coronavirus. Although
imports and exports have barely been affected, some sources expect
to see softer demand of polystyrene as Vietnam is one of the major
markets for Asian polystyrene.
In addition to demand contraction, the weakening Chinese yuan
also widened the gap between domestic and CFR China polystyrene
prices, and restrained domestic buyers from taking imports.
In statistic news, China imported 157,264 mt of general purpose
polystyrene, 31.80% lower month on month. The shutdown at end-user
plants during the Lunar New Year and logistical woes due to the
coronavirus outbreak had dampened buying interest of polymer.
16
ASIAN PETROCHEMICALSCAN April 3, 2020
Meanwhile, China’s January-February exports had also fallen due
to the coronavirus outbreak. Exports of expanded polystyrene fell
48.1% year on year to 21,986 mt in January and February, data from
China Customs Statistical Information Center showed.
Platts Asian PS Weekly Rationale
General purpose polystyrene CFR China was assessed down $30/mt
week on week at $840/mt CFR China Wednesday, based on tradable
indications at $830-$840/mt and below offers heard at $850/mt.
CFR Southeast Asia was down $50/mt on the week at $870/mt,
below an offer at $860/mt FOB Ho Chi Minh which was normalized to
$870-$880/mt CFR SEA.
High-impact polystyrene was assessed down $30/mt on the week
at $940/mt CFR China Wednesday, based on tradable indications at
$930-$940/mt and below an offer heard at $950/mt.
CFR SEA was also assessed lower by $30/mt on the week at $990/
mt, maintaining the price spread between CFR Southeast Asia and CFR
China.
Expandable polystyrene FOB Northeast Asia for general purpose
grade was assessed down $30/mt on the week at $870/mt
Wednesday, below offers heard at $890-$900/mt, while flame
retardant grade was assessed down $30/mt on the week at $920/mt
Wednesday, with the price spread between general purpose and flame
retardant grades maintained at $50-$80/mt.
ABS
Asian ABS: Weakness continues on lower feedstock
prices, fall in demand
„„ Lower ABS operating rates expected in S Korea
„„ ABS production margins at $189/mt
The downtrend in the Asian acrylonitrile-butadiene-styrene market
continued this week, with weaker feedstock prices and end-user
demand.
Asian ABS producers have lowered their offer levels in line with the
fall in feedstock, whereas buying interest remained thin as demand
dropped significantly following production shutdowns and national
lockdowns across the world.
Demand from the automobile and home appliances industries has
been heavily hit by the coronavirus outbreak which is taking its toll on
Europe and the USA — the major consumer markets for ABS
downstream products.
Some sources said that the wider gap between buying and selling
indications forced some producers to cut operating rates, instead of
reducing prices.
Widespread run cuts in April were seen from South Korean ABS
producers who mulled operating at 70%-80% in face of the growing
pandemic. Given the bearishness across all markets, market
participants also expected to see another round of rate cuts later.
Meanwhile, the devaluation of the Chinese yuan also weighed on
the Asian ABS market as buyers preferred domestic cargoes over
imports, forcing sellers to lower their offers for ABS imports.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
Upstream, Asian styrene slipped $17.50/mt on the week to $525/mt
Wednesday on the plunge in crude and bearish demand.
It has been falling sharply since early March as the coronavirus
outbreak crippled downstream demand while inventory stood at a high
level in East China.
The CFR Far East Asia ACN price was assessed down $35/mt week
on week at $1,110/mt Tuesday, the lowest since May 24, 2016, S&P
Global Platts data showed.
Acrylonitrile prices tumbled since February on poor downstream
demand as the spread of coronavirus saw spot supply rise in China,
hitting buying interest. According to Platts data, ABS margins were
calculated at $189/mt Wednesday, rising 3.14% on the week.
Platts Asian ABS Weekly rationale
Acrylonitrile-butadiene-styrene was assessed down $30/mt on the
week at $1,150/mt CFR China Wednesday, based on tradable indications
at $1,145-$1,155/mt CFR China.
CFR Southeast Asia was also assessed down $30/mt on the week
at $1,170/mt, maintaining the price spread between CFR Southeast
Asia and CFR China.
PTA
Asian PTA: Falls $10/mt on week amid bearish
sentiment
„„ Weak demand puts pressure on Asian PTA makers
„„ PTA/PX spread averages at $110/mt this week
Asian purified terephthalic acid prices fell $10/mt week on week to
$420/mt CFR China Friday, amid bearish fundamentals and falling
upstream paraxylene prices.
Physical spot discussions were scant this week, with a wide bid-
offer spread for CFR China cargoes, while no buying interest from India
was seen due to the nationwide lockdown.
Market sentiment remained bearish in China due to weak
fundamentals.
Chinese PTA inventories continued to pile up with the overall run
rate heard at around 80%-85% of total PTA capacity, sources said.
The prompt demand for PTA was not bad at the moment with
downstream polyester operating rates at above 80%. However, the
Chinese polyester and textile sectors were under pressure to cut or
shut production in April amid lackluster demand, especially from the
overseas markets, a China-based PTA producer said.
There was talk that some Chinese PTA manufactures were facing
high stocks and cash flow problems, which may lead to PTA production
cuts soon.
Prices for prompt cargoes in the domestic China PTA market was
assessed at Yuan 3,260/mt ex-works Friday, equivalent to around
$393/mt CFR China on an import parity basis, S&P Global Platts data
showed.
Market sentiment was mixed in South Korea, with some producers
saying they were seeing healthy sales and manageable inventories,
while others highlighted declining demand from Europe.
17
ASIAN PETROCHEMICALSCAN April 3, 2020
Taiwanese PTA producers were generally under pressure and
lowered operating rates. “We are running 80% at the moment and
would cut run rates further to 70% from mid-April,” one of the Taiwan-
based PTA producers said.
In India, most downstream polyester and textile sectors remained
shut amid the nationwide lockdown, except for PET films used for food
packaging and PET bottle chips for bottled water and beverage.
In plant news, South Korea’s Hanwha General Chemical plans to
shut its 700,000 mt/year PTA plant at Daesan for two to three days in
the first-half of April for regular production line cleaning, a source close
to the company said Friday.
In upstream markets, Asian PX was assessed $16.67/mt lower
week on week at $474.33/mt Friday. The PTA/PX spread was calculated
to average $110/mt this week, similar to the level seen in the prior
week, S&P Global Platts data showed.
Platts Asian PTA Weekly Rationale
The CFR China purified terephthalic acid marker was assessed
unchanged day on day and $10/mt lower week on week at $420/mt
Friday, reflecting indicative values of $410-$430/mt, below a selling
indication heard at $440/mt and above a buying indication heard at
$380/mt.
The East China domestic price of prompt cargoes was assessed up
Yuan 35/mt day on day at Yuan 3,260/mt ex-warehouse, reflecting
indicative values heard at Yuan 3,250-3,270/mt.
The CFR India PTA marker was assessed down $10/mt week on
week at $440/mt Friday, following the adjacent marker, and reflecting
a premium of $20/mt to the CFR China marker.
The CFR Southeast Asia PTA marker was assessed down $10/mt
week on week at $428/mt Friday, following the adjacent CFR China
marker, amid limited spot discussions.
(Asian PTA weekly price assessments are found on PCA179, daily
price assessments on PCA737)
PET
Asian PET: Spot prices tumble tracking upstream
markets
„„ Polyester producers start cutting run rates in China
„„ Stronger demand for bottle grade seen in Thailand
China’s domestic yarn and fiber grade polyethylene terephthalate
prices plunged Yuan 330-660/mt or 6%-13% on week, amid lower
upstream purified terephthalic acid and monoethylene glycol prices
and weak demand.
The production margins for POY and FDY grades fell into negative
territory at around minus Yuan 90/mt. As a result, a handful of PET
yarn and fiber producers in China decided to cut operation rates by
20% from April 1, sources said.
“Some small producers will start cutting operation rates starting
April 1. The inventory is high and no sign of demand from the textile
sector rebounding. It is a matter of time before major producers take
the same decision,” said a China-based producer.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
The global spread of coronavirus has hit textile exports. While most
traded orders were either canceled or delayed, there were limited
number of new orders amid sluggish demand for clothing in
international markets.
“Even if there is a new order from overseas, textile makers are
stepping back as they fear the payment can not be collected in time.
As a result, the operation rates at downstream textile makers are
expected to be cut,” a market source said.
The upcoming three-day Qingming festival national holiday in
China, which is expected to start April 4, could be extended for
seven-10 days, a market source said, in order to reduce operations and
lower inventory at downstream plants.
Upstream, CFR China PTA was assessed down $25/mt week on
week at $415/mt; and CFR China MEG was down $27/mt over the same
period at $360/mt.
Asian bottle grade PET prices were also impacted by the
downtrend in upstream markets, however, its demand remained
healthy.
In Thailand, due to partial lockdown in the country, people were
stocking up on essential supplies, including drinking water.
“Despite weak demand from restaurants and hotels due to fewer
tourists, demand sentiment is bullish as more people are stocking up
on drinking water,” a Thailand-based producer said.
In addition, the demand for bottle grade PET for medicinal alcohol
was also strong, a trader said, with demand from producers surging by
400%.
Platts Asian PET Weekly Rationale
FOB Northeast Asia polyethylene terephthalate was assessed down
$30/mt week on week at $670/mt Wednesday, below an offer at $710/
mt FOB Korea, $700/mt FOB China and $780-$790/mt FOB Taiwan, and
higher than tradable values seen by a trader at $665/mt FOB China.
FOB Southeast Asia PET was assessed down $60/mt at $660/mt,
below an offer at $700/mt, above a bid at $620/mt, and tracking the
last done deal at $660/mt FOB Southeast Asia.
The prompt China domestic POY150D/48F was assessed Yuan 655/
mt lower at Yuan 4,700/mt ex-works, reflecting tradable discussions
heard at that level.
The prompt China domestic DTY150D was assessed down Yuan
600/mt at Yuan 6,600/mt ex-works, reflecting tradable discussions
heard at that level.
The prompt China domestic FDY150D/96F was assessed Yuan 525/
mt lower at Yuan 5,200/mt ex-works, reflecting tradable discussions
heard heard at that level.
The prompt China domestic PSF was assessed Yuan 330/mt lower
at Yuan 5,370/mt ex-works, reflecting tradable discussions heard
heard at that level.
(Price assessments are found on PCA625)
18
ASIAN PETROCHEMICALSCAN April 3, 2020
News
India’s GAIL shuts HDPE/LLDPE swing plant, runs PE
plant at 50% during lockdown
India’s GAIL has shut the 210,000 mt/year high density/linear low
density polyethylene swing plant and is running the 400,000 mt/year
polyethylene plant at its Pata complex in Uttar Pradesh at 50% of
capacity during the country’s 21-day nationwide lockdown, a company
source said Thursday.
Capacity at the 400,000 mt/year PE plant was halved by shutting
200,000 mt/year of high density lines, the source said.
“It was shut around March 25. Difficult to predict restart, which will
depend upon the prevailing scenario in the near future,” the source
said.
Market sources said there was virtually no demand in India for PE
at present due to the lockdown to contain the coronavirus pandemic.
Northeast Asia set to receive over 30,000 mt of MX
from US in May-June: source
At least one Northeast Asian end-user is set to receive between
30,000 mt and 40,000 mt of isomer-grade mixed xylene from the US
Gulf over late May to early June, a source with the buyer said Thursday.
“We continue to check for more cargoes,” he said.
After the onset of the coronavirus pandemic in the US, MX prices in
the country have fallen below Asian price levels, counter to the trend
seen earlier this year, when the arbitrage from Asia to the US was
open.
This resulted in Asian MX prices hitting highest globally, despite the
recent slump.
Asian isomer-grade mixed xylene fell $13.25/mt on the day at $336/
mt FOB Korea and $13.75 at $354/mt CFR Taiwan Wednesday, while US
April loading FOB US Gulf MX fell $12.16/mt to $313.12/mt.
US MX hit a year-to-date low of $267.52/mt March 24, at which time
the CFR Taiwan price was at $407.50/mt, meaning a price spread of
nearly $140/mt, and more than enough to cover freight of around $71-
$74/mt for 10,000-12,000 mt from the US Gulf to Northeast Asia, S&P
Global Platts data showed.
Asian steam crackers increase naphtha feedstock use
as price falls below LPG
At least one Asian steam cracker has switched back from using LPG to
maximizing naphtha usage as feedstock as prices of Asian naphtha
plunge below LPG, making naphtha the preferred steam cracking
feedstock, market sources said Friday.
The Far East Index propane swap spread against the Mean of Platts
Japan naphtha swap touched $69.75/mt Wednesday before narrowing
to $54.75/mt at Thursday’s Asian close, according to S&P Global Platts
data. The spread was last higher on October 9, 2017 at $75.25/mt,
Platts data showed.
LPG flipped to a premium over naphtha on March 27 at $20.50/mt,
Platts data showed.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
The switch back to naphtha from LPG will result in lower ethylene
and higher propylene production, which has prompted Thailand’s PTT,
which has made the feedstock switch, to import more ethylene and
export propylene, a company source said. PTT reportedly bought two
3,000-3,5000 mt ethylene cargoes last week for H2 April delivery, the
source said.
LPG typically becomes economically viable as a steam cracking
feedstock when its price is 90% that of naphtha, or lower. With LPG
now commanding a premium over naphtha, more steam crackers are
expected to maximize the use of naphtha, and this will prompt more
demand for ethylene due to lower production, sources said.
PETROCHEMICAL GLUT
Naphtha prices have fallen as the coronavirus pandemic reduced
downstream demand and slumping crude oil markets dragged down
flat prices. and steam crackers were keen to take advantage of this,
traders said.
However, steam cracker operators were purchasing naphtha with
caution as they struggle to export their length of petrochemical
products, particularly ethylene, as petrochemical demand from China
has fallen.
Cash differentials for spot paraffinic naphtha on a CFR Japan basis
averaged $6.49/mt in March, down sharply from $18.83/mt in February,
Platts data showed.
The differential has since slipped into negative territory at minus
50 cents/mt at Thursday’s Asian close, due to greater naphtha supply
from the West and weaker demand amid unplanned cracker outages in
March.
The Asian naphtha paper market has reflected the ebbing strength,
remaining in a contango structure since March 13, Platts data showed.
The front month May/June MOPJ naphtha swap timespread was last
assessed at minus $15.50/mt at Thursday’s Asian close, Platts data
showed.
LPG DEMAND RECOVERS IN CHINA
After falling to around a 20-year low of $185/mt on March 24 amid a
pause in Chinese demand due to measures to contain the coronavirus
pandemic, the CFR North Asia propane price rebounded to a three-
week high at $259/mt Thursday as Chinese industries gradually return
from mandated shutdowns.
Demand has also surged in India, where state-run companies are
seeking to import via tender almost 500,000 mt of evenly split LPG for
April-June delivery in the wake of a 21-day nationwide lockdown that
has cut refinery production, while demand in Indonesia has resurfaced
ahead of the Ramadan fasting month.
Philippines’ JG Summit steam cracker shut on power
outage: sources
Philippines’s JG Summit shut down its naphtha-fed steam cracker in
Batangas on Monday because of a power outage, according to market
sources.
The cracker is able to produce 320,000 mt/year of ethylene and
190,000 mt/year of propylene.
19
ASIAN PETROCHEMICALSCAN April 3, 2020
The company could not be reached for comment. Further details
could not be confirmed.
April Asian Contract Price negotiations for PX end
without settlement
Negotiations for the April Asian Contract Price for paraxylene have
ended without settlement because of high market volatility and a wide
bid-offer range, market sources said Tuesday.
This means there has been no major settlement since August 30
last year for the September contract, at $780/mt CFR Asia.
PX producers nominated the April ACP at $600-$680/mt, while
end-users’ counter-bids were heard no higher than $380/mt, all on a
CFR Asia basis.
Asian PX spot prices were last assessed at $466.17/mt CFR Taiwan/
China on Monday.
There are six PX ACP sellers in Asia: Japan’s JXTG Nippon Oil &
Energy and Idemitsu Kosan, South Korea’s S-Oil and SK Global
Chemical, ExxonMobil, and India’s Reliance.
Typically, there have been seven ACP buyers: BP, Taiwan’s Capco
and Oriental Petrochemical (Taiwan) Corp., Japan’s Mitsui Chemicals
and Mitsubishi Chemical, and China’s Yisheng Petrochemical and
Jiangsu Shenghong Chemical Fiber Co.
© 2020 S&P Global Platts, a division of S&P Global Inc. All rights reserved.
S Korea’s LG Chem plans to maintain steam crackers
run rates at 100% for April
South Korea’s LG Chem plans to maintain the operating rate of its
steam crackers in Daesan and Yeosu at full capacity in April, a
company source said Thursday.
Asian steam crackers have been on the fence about adjusting run
rates down in line with the global economic slowdown due to the
coronavirus pandemic, which has already impacted downstream
demand.
“The critical thing is observing the supply of polyethylene and
other downstream products. And there will be no new demand for
home appliance and vehicle manufacturing from mid-April to May, and
demand from other industries may [decrease] from current levels,” the
company source said.
The company had first raised run rates to 100% on March 7
following the shutdown at Lotte Chemical’s Daesan plant, company
sources said.
The company had reduced rates at Daesan and Yeosu to 95% on
March 1 amid weak margins from the downstream polyethylene sector.
The company’s steam cracker in Yeosu is able to produce 1.18
million mt/year of ethylene and 550,000 mt/year of propylene, while
the cracker in Daesan is able to produce 1.27 million mt/year of
ethylene and 650,000 mt/year of propylene.
20