Benzene prices consistently showing upward momentum in Asian market which supporting higher benzene spot numbers in Europe,source said on 8 December, although this has been evidenced more in coming market than December. After trading many times earlier that week between $715-720/tonne, December benzene prices inched up to the mid $700s/tonne before closing as high as $770-790/tonne, but no trade activity were heard in this time. January numbers have meanwhile seen a slow increase since the start of the week, with deals initially closed at $720/tonne. However, as spot numbers in Asia gradually went up, January trades in Europe also weighed from root level, with trades closed on Wednesday 7th December’16 at $750/tonne and $780/tonne.
Offers for December were heard in beginning of 8th December’16 at $800/tonne which was not met with any strong bids. December bids were heard around $800/tonne after that but there were no corresponding offers were heard because buyers not showed interest in procurement. January benzene prices remained in contango with offers at $820/tonne.Bids were heard later between $805-810/tonne. The pushed demand in Asia has been supported by strong Chinese demand and poor availability of the material in the region. There is a healthy benzene/styrene spread, which is further supporting benzene consumption. There is perhaps some resistance to the higher prices of benzene in December, with the monthly contract settlement noticed significantly lower than $700/tonne.One of the key market observer of nylon sector downstream of the chemical also added that many major and medium players are trying to avoid any high inventory destocking this month, as the current momentum on benzene prices would expected to a triple-digit increase on the January contract settlement.Asian toluene prices noticed higher;
Asia’s toluene prices hit their highest levels since end-July 2015 on 9 December, due to a lack of spot sellers for January cargoes and surging yuan-denominated prompt and forward toluene prices. At the close of trade on 9thDecember’2016, the midpoint of the assessed spot toluene price range was between $700-705/tonne FOB Korea, with the whole price range at $691-711/tonne FOB Korea. These prices were last seen on 24 July 2015, when the average price was at $703.50/tonne FOB Korea. Domestic toluene prices in China were also on an upward trend, rose at least 8% to Chinese yuan (CNY) 6,000/tonne at the close of trade on 9th December’16.We also able to provide Ex-tank prices of Indian market.
Ex-tank prices in China were mainly supported by long holding position taken by giant-sized traders and which improved trading sentiment, which came from increasing futures market for downstream products such as styrene monomer prices (STYRENE MONOMER) and mono ethylene glycol prices(MEG). For the toluene prices on FOB Korea basis, the lack of sellers for both January and February toluene shipments was one of the reasons prices increased at the time interval, market players said.“If there is positive seller, obviously buyers will try to push materials for January-loading cargoes.Limits and consistently give higher bids to attract any form of selling interest,” a South East Asia-based trader said. Furthermore, port declaration by traders on 9th December’16 gave Polyethylene terephthalateus to aggressive buyers that needed to cover their short positions for January-loading cargoes. “There are still some buyers Chinese or northeast Asia which trying to cover their shorts before the Lunar New Year period and it was natural for them to be more aggressive or panicky since few sellers have emerged,” a southeast Asian trader said. The Lunar New Year will be on 28 January 2017.The consistent rise in downstream benzene prices provided further reason for market players to take on an even more positive trading sentiment on toluene.
Toluene is generally used as a feedstock for downstream benzene production, using either the toluene disproportionation (TDP) or hydrodealkylation (HDA) process. The toluene-benzene spread was at $180/tonne on average in the week, a level last seen more than two years ago in the first half of November 2014.As a result, talks were rife of fewer toluene cargoes from integrated refineries for future January loading because of the potential increase in allocation for downstream benzene production. Traders were worried that the market has overheated in a short period of time. “There can be market rebalancing and even price correction since prices have shot up too quickly in the past week,” one southeast Asia-based trader said. Furthermore, it will be difficult for prices to move up further because of unchanged demand from other key downstream sectors such as toluene di-isocynates and solvent, traders said.
