Houston (Platts)--22Feb2012/830 am EST/1330 GMT

Asian benzene fell $1/mt day on day to $1,199.50/mt FOB Korea February 22, amid light trading activity. Front month ICE Brent crude futures rose $1.87/barrel day on day to $121.73/b at 4:30 pm Singapore time (0830 GMT) February 22.

In the US, benzene climbed nearly $18 February 21 to $1,276/mt FOB USG, European benzene gained $6/mt over the same period to $1,265.50/mt CIF ARA.

"There is no direction for the past few days, I think because people realize the downstream demand in China for styrene and other downstream products are very weak," a South Korean trader said. (See chart 1)

The FOB Korea toluene marker was assessed at $1,223.50/mt on February 22, up $9.50/mt from the day before amid a firmer upstream market and rising US Gulf toluene prices.

Market commentary continues below...

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In the US February 21, toluene leaped to a nine-month high of $1,261/mt FOB USG. The delta between the US and Asian prices remained too narrow to motivate exports.

The European toluene price, was the lowest globally at $1,186/mt FOB Rdam. (See chart 2)

Asian isomer-grade mixed xylenes were assessed at $1,384.50/mt FOB Korea and $1,394.50/mt CFR Taiwan February 22, flat from a day earlier as market participants monitored developments in downstream paraxylene Asia Contract Price nominations.

In the US, where market activities resumed February 21 after a public holiday February 20. MX was assessed slightly higher at $1,308/mt FOB USG. Upstream, feedstock naphtha rose $18.25/mt period to $1,065.25/mt CFR Japan.

In plant news, Japanese refiner Idemitsu Kosan plans to shut its aromatics plant in Chiba, eastern Japan, in March for 50 days of annual maintenance, a company source said February 22. The plant is able to produce 265,000 mt/year of PX, 577,000 mt/year of benzene and 353,000 mt/year of MX.

Market participants said the shutdown of the plant will not have any impact on the Asian isomer-MX market as its MX production is entirely for captive use.

The company also plans to shut its aromatics plant in Tokuyama, western Japan, in September for around 50 days of annual maintenance. That plant is able to produce 274,000 mt/year of benzene, 130,000 mt/year toluene, 317,000 mt/year xylene and 200,000 mt/year PX. (See chart 3)

The Asian paraxylene market rose $4.50/mt February 22 from February 21 to be assessed at $1,641.50/mt CFR Taiwan/China.

In China, Sinopec settled its February contact prices -- PX at Yuan 12,300/mt and PTA at Yuan 9,450/mt -- up Yuan 400/mt and Yuan 350/mt, respectively, from January settlements.

The prices are equivalent to $1,628/mt for PX and $1,198/mt for PTA. South Korea's S-Oil nominated its PX Asia Contract Price for March at $1,690/mt CFR, up $100/mt from its February settlement of $1,590/mt, while Japan's JX Nippon Oil & Energy nominated at the same price.

Japanese refiner Idemitsu Kosan announced its nomination for March at $1,740/mt, up $150/mt from February. The price increase for March is to reflect higher naphtha feedstock costs.

According to Platts' data, the CFR Japan naphtha price has averaged $1,016.43/mt to date in February, up $60.82/mt from $955.61/mt in January. But for downstream PTA producers, the nomination price means negative production margins.

Based on the current PTA spot price of $1,191/mt CFR, PTA producers would suffer negative margins of $82-116/mt at March nomination prices.

The US PX price, climbed February 21 to $1,575/mt FOB USG. The European PX price, was assessed February 21 at $1,534/mt FOB Rdam. (See chart 4)

Asian styrene monomer was assessed up $1 day on day to $1,449/mt FOB Korea February 22, tracking a firmer energy complex. "Cost looks very high, but the downstream [markets] are [bad]," a trader said.

Looking downstream, acrylonitrile-butadiene-styrene prices were assessed down $25/mt week on week by Platts at $2,160/mt CFR China February 22 due to weak demand.

PetroChina's Jilin Petrochemical plans to start up a 320,000 mt/year SM unit in northeastern Jilin province in August, local media JYD reported this week. The startup will lift Jilin's total SM capacity to 460,000 mt/year.

The SM units will supply feedstock to the company's 300,000 mt/year acrylonitrile-butadiene-styrene unit and 150,000 mt/year styrene-butadiene-rubber unit at the same site.

The US styrene price, was assessed February 21 at $1,491/mt FOB USG. The European styrene price, was assessed February 21 at $1,513/mt FOB Rdam.

jim_foster@platts.com

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