Asia petrochemicals: Key market indicators for Sep 13-17

Logistical issues are expected to continue to weigh on the Asian petrochemical market over Sept. 13-17, due to port congestions in China and record-high container freight rates.

Tropical Storm Nicholas, which was seen churning through the US Gulf Coast Sept. 12, is expected to make landfall along the Texas shoreline Sept. 13. threatening to disrupt some refining operations in the state just as plants were recovering from Hurricane Ida.

Benzene

** The Asian benzene outlook appeared stable-to-strong, with most market participants assessing the impact of upcoming downstream closures in the styrene sector, sources said.

** Tight benzene supply in China has supported prices, but high freight costs and slower offloading rates were an added risk, sources said. FOB Korea benzene physical rebounded to $1,002/mt Sept. 9, before slipping to $995.33/mt Sept. 10.

Toluene

** The demand in China and Southeast Asia was weak, with substantially high inventories in storage tanks, according to the Chinese government data. Discussions continued between the Southeast Asian sellers and Indian buyers, but vessels shortages slowed trade significantly, sources said.

Isomer-MX

** The market outlook for isomer-grade mixed xylene was bearish due to longer delivery estimates for October cargos, amid maintenance-related closures in the downstream sector and weak demand in the polyester chain, sources said.

** The paraxylene-naphtha spread narrowed sharply over the last couple of weeks, spooking PX producers in the region, and resulting in soft Asian isomer-MX for PX production, sources said.

Propylene

** Chinese imports of the product were likely to be slow due to port congestions, while South Korea's propylene inventory was building up amid shipping delays and bad weather, sources said.

** China's propylene supplies are also seen increasing, as more propane dehydrogenation plants were expected to start up in Shandong and Ningxia by mid-September, sources said.

Butadiene

** Asian butadiene prices were expected to weaken over Sept. 13-17, pressured by high supplies and lower US demand, despite some plant closures in the US, sources said.

** CFR China-FOB Korea price spread could widen as FOB Korea premium was diminishing in line with weak US demand, sources said.

PVC

** Market participants were eyeing fresh offers for October over Sept. 13-17, with possibly higher prices compared with September, due to tight supplies because of Hurricane Ida-related plant closures, sources said.

** October volumes were likely to be lower compared with September, on possible delivery delays amid record-high freight rates and limited container space, sources said.

Oxo Alcohols

** The CFR China 2-ethyl hexanol price is expected to trend lower week on week over Sept. 13-17, as plant turnarounds come to an end, sources said. China's Shandong Bluesail Chemical is planning to restart its 150,000 mt/year oxo alcohol plant at Zibo, Shandong province, around Sept. 20, following a closure on Aug. 21, S&P Global Platts reported earlier.

** China's Tianjin Bohua Yongli is planning to delay restarting its oxo alcohols swing plants by two days to around Sept. 13, Platts reported earlier. The plant was shut for a turnaround Aug. 15. Tianjin Bohua Yongli has two 250,000 mt/year swing plants that produce normal butyl alcohol or 2-ethyl hexanol.

Methanol

** Asian methanol prices are expected to rise, particularly in China, over Sept. 13-17, after Chinese coal futures surged more than 3.5% in morning trade Sept. 13, as coal mines in the country's northwest region shut due to safety and power usage restrictions, sources said.

** The upward momentum is expected to continue in South Korea as concerns mount over US supply to Asia, sources said. Methanol production facilities in the US had faced difficulties in resuming production, because of the disruption related to Hurricane Ida.

** South Korean and China methanol prices rose $14/mt and $11/mt on the week to $415/mt and $337/mt, respectively, Sept. 10, Platts data showed.