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Morning Briefing - 13 June 2023The ethylene-naphtha spread is currently calculated at $187-207/ton – way below the typical spread of $300-350/ton, meaning cracking operators are operating at squeezed margins. |
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CommoPlast
Morning Briefing
13 June 2023
Brent: $71.84 (- $2.95)
WTI: $67.12 (- $3.05)
Naphtha CFR Japan: $543 (- $12)
Ethylene CFR NEA: $730 (- $20)
Ethylene CFR SEA: $750 (- $30)
Propylene FOB Korea: $710 (- $25)
Propylene CFR China: $735 (- $5)
*Data represent closing prices of the previous trading day
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The Asian ethylene market extended the weakening trend, hitting the lowest levels since early November 2020 on tepid downstream demand. Some buying ideas emerged at $700/ton in the Northeast Asia region, however, sellers remain cautious given the firm upstream naphtha costs.
The ethylene-naphtha spread is currently calculated at $187-207/ton – way below the typical spread of $300-350/ton, meaning cracking operators are operating at squeezed margins.
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The Chinese PP and PE market gallop into the negative territory on the first trading day of the week, bearing pressure from the falling futures market, weak energy complex, and softer purchasing interest. Once again, spot homo-PP dopped below the CNY7000/ton threshold, yet transactions were thin.
Key Chinese producer – Zhongjing Petrochemical cut export PP offers again by $5-10/ton from the previous week, underlining a possibility that Chinese sellers might escalate the effort to deplete more cargoes in the near-term.
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