A US-Asia mixed xylenes arbitrage swung open on Tuesday, as the FOB Korea H1 October assessment shot up $17 (5.60 cents/gal) to $828/mt overnight,according to Platts data.
This morning in the US August MX was bid at 246 cents/gal ($745/mt) and offered at 256 cents/gal. Freight for a 5kt vessel was between $45-50/mt. Assuming a rate of $50/mt and a deal at offer level of 256 cents/gal, an arb
was workable with about $2/mt in margin.
The FOB Korea assessment rose Tuesday due largely to firming downstream PX market. However, the upside of the Asian iso-MX segment was capped as a PX-MX spread remained unfavorable for PX production. On Tuesday, the spread was pegged at $112/mt, compared with $114/mt last Friday. PX makers typically look for about a $150-200/mt MX to PX spread.
This morning in the US August MX was bid at 246 cents/gal ($745/mt) and offered at 256 cents/gal. Freight for a 5kt vessel was between $45-50/mt. Assuming a rate of $50/mt and a deal at offer level of 256 cents/gal, an arb
was workable with about $2/mt in margin.
The FOB Korea assessment rose Tuesday due largely to firming downstream PX market. However, the upside of the Asian iso-MX segment was capped as a PX-MX spread remained unfavorable for PX production. On Tuesday, the spread was pegged at $112/mt, compared with $114/mt last Friday. PX makers typically look for about a $150-200/mt MX to PX spread.
