Japan's ENEOS settles July benzene CP higher than June at $1,040/mt CFR

Japan's largest benzene producer, ENEOS Corporation, concluded its July Contract Price for benzene at $1,040/mt CFR Asia, up $70/mt from its June settlement of $970/mt CFR Asia, the company said in an email seen by S&P Global Platts June 30.

The settlement is also $20/mt lower than its initial nomination of $1,060/mt CFR Asia.

The July CP took into consideration expectations of strong demand for benzene derivatives, on the back of a gradual global economic recovery. Historically low inventory levels of benzene and styrene in east China also contributed to the rise in the CP.

The rise in benzene prices could, however, affect run rates at downstream plants, amid limited recovery in downstream product demand as well. Market sources said the recent bullishness in styrene mostly stemmed from the strength in benzene.

Asian styrene was assessed up $28.50/mt on the week at $1,228/mt CFR China on June 30 while the domestic prompt marker jumped Yuan 110/mt over the same period to Yuan 9,240/mt on June 30, boosted by an upwards pricing adjustment by China's major benzene producer Sinopec.

In Europe, the July CP settlement was finalized June 30 at $970/mt and Eur816/mt, down $103/mt or Eur68/mt from June. One buyer and three sellers confirmed they had fully settled their contracts at this level on June 30.

Contract settlement counterparties reported using a dollar-euro exchange rate of 1.1888 for the settlement.

European spot prices trended downwards throughout June, as stock levels in the market continued to recover from shortages in April and early May. While strong downstream demand for plastics continued to show the styrenics sector as healthy, additional imports left the European market flush with benzene.

Over in the US, market participants were waiting for the July CP to settle in the week of June 27. A market source said the July CP settled at 309 cents/gal, but this information was not confirmed by the companies involved in the negotiations.