The CFR China marker was flat week on week at $332/mt
Friday(as on 13th Jan2017), amid muted demand from
methanol-to-olefin plants. Domestic China methanol price fell Yuan130/mt week
on week Yuan 2,900/mt Friday. China's Jiangsu Sailboat Petrochemical, also
known as Jiangsu Shenghong, has shut its MTO plant late last week and is
expected to restart early-February, after the Lunar New Year holidays, pending
startup of its downstream ethylene vinyl acetate unit, a company source said
Tuesday. "The [post-holiday] startup timeframe for the EVA plant is the
best current estimate, but may be delayed, depending on operational
considerations," the source added. The MTO plant has capacity to produce
385,000 mt/year of propylene, 315,000 mt/year of ethylene and 100,000mt/year of
C4/C5, consuming about 2.4 million mt/year of methanol in the process. Last
week, Zhejiang Xingxing New Energy lowered the operating rate of its MTO plant
to 80%, due to falling margins, a company source said. As a result, "China
demand has been weak leading into the Chinese New Year [holiday season], with
plenty of incoming cargo," a trader said Friday. Earlier in November to
December, Middle Eastern producers preferentially allocated cargo to China due
to surging prices then. As a result, regions such as Southeast Asia, South
Korea, and Taiwan have been feeling the supply pinch this week, industry
participants noted. Sellers in each region offered in excess of$360/mt, but
end-users and buyers had varying appetites for cargo, amid tight supply and
rising prices. After surging $21/mt from December to $331/mt CFR India last
week, prices corrected downwards a bit this week to $327/mt, as traders
digested news from China. "Not much volumes is coming from Iran this week,
but with China prices moving down, we expect [volumes to] improve in the coming
week -- so supply looks stable in India," an Indian trader said Friday. RATIONALE:CFR
China was assessed at $332/mt Friday, unchanged week on week, based on tradable
indications heard in the $325-$340/mt range. The domestic price fell Yuan
130/mt week on week to Yuan 2,900/mt Friday. CFR Southeast Asia was assessed at
$351/mt, up $9/mt week on week, with a buying indication heard at$350/mt and
selling indications heard at $355-$360/mt. CFR Korea was assessed up $14/mt
week on week at $356/mt, based on offers heard in the $361-$368/mt range and
bids heard at $355/mt. The CFR Taiwan marker was assessed $8/mt higher week on
week at $348/mt, with buying and selling ideas heard at$340-$345/mt and offers
at $362-$368/mt. The CFR India marker was down $4/mt week on week to $327/mt,
based on tradable indications heard at $320-$330/mt, and buying ideas heard at
$310/mt.
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