Morning Briefing - 14 April 2022
CommoPlast
Morning Briefing
14 March 2022
Brent: $108.78 (+ $4.14）
WTI: $104.25 (+ $3.65）
Naphtha CFR Japan: $924 (+ $35.3)
Ethylene CFR NEA: $1310 (- $40)
Ethylene CFR SEA: $1360 (- $40)
Propylene FOB Korea: $1190 (Stable)
Propylene CFR China: $1150 (+ $10)
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The Asian ethylene market is near three-week lows amid the thin buying interest. Key ethylene derivative – PE market has yet to see any major uptick in demand, taking away the incentive for PE producers to make additional restocking.
The upstream naphtha costs surged above the $900/ton threshold for the first time in seven days. The naphtha-ethylene spread stands at $386-436/ton – higher than the theoretical spread of $300-350/ton. Market sources expected the slothful demand condition across the supply chain to drag ethylene prices lower in the near term despite the 10% surge in crude oil prices over the past two sessions.
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The emergence of the new HDPE film grade from a South Korean producer in Vietnam at $1280/ton CIF is a ‘salt-in-the-wound’ type of development. Buyers have placed bids at $1250/ton for the cargoes, but no deals are observed at the time of this report.
The Vietnamese market is highly price-sensitive in nature. Regardless of the unpopular grade, buyers have the impression that other sellers are now facing heightened pressure to maintain their competitiveness, especially with the falling demand for imports in Indonesia and China.
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ExxonMobil Singapore might shut its No. 1 cracker in Jurong Island in the final week of April for at least one month in tandem with the production disruption at the downstream PP, and PE units (announced last week). The cracker has an annual output of 900,000 tons/year of ethylene and 490,000 tons/year of propylene. There is no information on the operating rates at the No. 2 cracker at the moment.
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