Platts Petrochemical Analysis: Asian Benzene Prices Fall as Crude Oil Retreats

Asian benzene prices fell $2/mt day on day March 14 to $1,190.50/mt FOB Korea as crude oil retreated, despite a rise in US benzene prices. Front month ICE Brent crude futures slipped $0.13/barrel day on day to $125.73/b at 4:30 pm Singapore time (0830 GMT) March 14.

In the US, benzene was flat overnight March 13 at 419 cents/gal ($1,254.07/mt) FOB USG. European benzene gained $2/mt over the same period to $1,206/mt CIF ARA. "[Asian] benzene has not been able to follow the year-to-date upward climb in crude oil prices because of poor downstream demand," a South Korean trader said.

Asian toluene on an FOB Korea basis was assessed at $1,230.75/mt March 14, down $6.75/mt from the day before amid lower crude. US toluene gained a penny ($3/mt) to an assessment of 417 cents/gal ($1,267.68/mt) FOB USG, while European toluene was flat March 13 at $1,213/mt FOB Rotterdam. 

Asian isomer-grade mixed xylene prices continued to track down March 14 for the third consecutive day in tandem with the downstream paraxylene market. Prices were assessed at $1,389.50/mt FOB Korea and $1,399.50/mt CFR Taiwan, down $5/mt from a day earlier.

In the US March 13, MX prices were held flat from a day earlier at 450 cents/gal ($1,363.50/mt) FOB US Gulf.

Asian paraxylene prices fell $11/mt from March 13 to be assessed at $1,608.50/mt FOB Korea and $1,633.50/mt CFR Taiwan/China March 14. Market participants were closely monitoring the operation status of purified terephthalic acid plants in Asia, which were reported recently to be coming down.

In China, Sinopec was reported March 14 to have shut one of its PTA plants in Yangzi amid negative margins. Sinopec Yangzi has three PTA plants with combined production capacity of 1.25 million mt/year. Its 350,000 mt/year No. 1 PTA plant has reportedly been shut since March 1. China's Zhejiang Yisheng was reported to have shut its 2 million mt/year No. 3 PTA plant in Ningbo from March 13 for five days.

The company has three PTA lines with a combined production capacity of 3.3 million mt/year. Prior to the shutdown, the run rates of all three lines were reported at 80%. There was also talk spreading in the market of China's PTA plant runs being slashed further in April.

But some market sources said this was merely speculation and no confirmation was immediately available. Sinopec confirmed the shutdown of one of its PTA plants but did not specify which one, while no confirmation was available from Yisheng. "We should keep watching for shutdown news as they may be just rumors amid negative PTA margins," a market source said.

Amid this, spot PX demand continued to weaken further March 14. US PX was down $5/mt March 13 to an assessment of $1,575/mt FOB USG, while European PX was down $9/mt to $1,537/mt FOB ARA.

Asian styrene monomer prices continued to soften March 14, slipping $4/mt day on day to $1,484.50/mt FOB Korea and by $2/mt over the same period to $1,492.50/mt CFR China. Sentiment remained bearish amid news that China's government will continue efforts to cool its housing market.

US styrene was flat March 13 at $1,487/mt FOB USG, while European styrene was $4/mt higher March 13 at $1,496/mt FOB Rotterdam.

(Platts.com, Edited by Topco)