This morning, September and October spot benzene was talked between 288-291 cents/gal DDP USG. Just ahead of the Platts Market on Close process, buy ideas were at 290 cents/gal against sell ideas at 295 cents/gal. Meanwhile the Platts' 3:15 assessment of October crude spiked up $1.08 from the previous day to close at $74.99/barrel.
Looking ahead, participants disagreed about the October benzene outlook. Some suggested there would be no derivative styrene exports in the second half of September and into October. In this case, benzene could fall back to 290 cents/gal or lower.
Others though said SM in the Far East firmed up on Wednesday and also cited feedstock sourcing issues at Pars Petrochemical Company's 600,000 mt/year styrene plant in Iran. Asia "is not fully covered yet, so there's still a little bit of potential," a trader said.
Should styrene in Asia maintain its strength, then it could spark a US-Korea styrene arb and thereby support higher benzene prices in the 290-300 cents/gal range. Another bullish factor was if Iran's Pars decided to buy spot benzene from Asia. In this case, the US would be forced to pay more to attract cargoes from the Middle East to North America.
China Chemical Weekly: http://news.chemnet.com/en/detail-1411716.html
