Argus DeWitt Toluene and Xylenes Daily

Transcription

1 Argus DeWitt Toluene and Xylenes Daily Highlights Americas Toluene rose 4.5 as buy interest was firm despite weakness in upstream energy markets. Mixed xylenes remained stable in a thinly discussed market. Europe Toluene and MX prices eased following declines in the gasoline market. Market Snapshot Americas Timing Midpoint ± MTD Toluene fob HTC Sep Toluene fob HTC Oct Mixed xylenes 5211 fob HTC Sep Mixed xylenes 5211 fob HTC Oct Mixed xylenes 843 fob HTC Sep Paraxylene fob USGC Sep Europe Timing Low-High ± MTD Asia Pacific There is no Asia Pacific assessment due to a public holiday in Singapore. About Argus DeWitt Argus DeWitt is a leading independent source of pricing data and market intelligence for the aromatics, olefins and related petrochemical markets. Purchasers, business analysts, traders, producers and product managers benefit from Argus DeWitt insight every day. Toluene fob NWE Sep Mixed xylenes fob NWE Sep Paraxylene fob NWE Sep Asia-Pacific Midpoint ± MTD Toluene fob S Korea marker na na na Toluene cfr China marker na na na Mixed xylenes fob S Korea marker na na na Mixed xylenes cfr Taiwan marker na na na Paraxylene fob S Korea marker na na na Paraxylene cfr Taiwan marker na na na Paraxylene cfr China marker na na na PTA cfr China na-na na Global toluene S/t Global mixed xylenes 800 USGC NWE South Korea 1,000 USGC NWE South Korea Aug 18 Aug 25 Aug 2 Sep 10 Sep Jun 15 Jul 13 Aug 10 Sep

2 Americas Toluene Toluene increased 4.5 in a thinly traded market with firm buy interest but muted selling interest. September bids opened at 195 on an fob ITC terminal basis against no firm offers in the morning. Bids held firm in the afternoon, and offers were pegged at 210 at parity with offers yesterday. October bids were heard at 190 on an fob HTC basis absent offers. Bids failed to attract offers in the afternoon. Fourth-quarter 2015 offers at 210 were used to set the high end of the assessment range. Quarter-four 2015 was bid at 191 in the morning against offers at 210. Discussions were stable in the afternoon, revealing a nearly flat forward curve. Mixed xylenes Mixed xylenes remained stable on Friday amid firm buy interest despite a lack of offered product. September fob ITC terminal bids for mixed xylenes opened at a 5 discount to toluene bids at 190. No offers were heard in the morning. By the afternoon, bids rose to 195, but this failed to draw out firm offers. Notional offers were pegged at 220. October discussions were muted throughout the day. The forward-month was last heard flat to September, and so October was assessed at parity with September. Paraxylene was bid late-morning at $750/t (34.02 /lb) on an October fob HTC basis against offers at $850/t (38.56 /lb). Bids and offers held firm in the afternoon. The September assessment fell on lower-priced October discussions, which were assumed at parity. Americas prices Timing Low-High ± MTD Toluene fob HTC Sep Toluene fob HTC Oct Mixed xylenes 5211 fob HTC Sep Mixed xylenes 5211 fob HTC Oct Mixed xylenes 843 fob HTC Sep Paraxylene fob USGC /lb Sep Toluene-conv gasoline blend Toluene-Rbob gasoline blend MX-conv gasoline blend MX-Rbob gasoline blend Contract prices Paraxylene /lb Aug 46.00/46.75 na Related markets Nymex Rbob Oct Nymex WTI $/bl Oct Toluene blend values Conventional blend value Rbob blend value Mixed xylenes blend values 25 Jun 22 Jul 17 Aug 11 Sep Toluene, MX premium to gasoline 87M Conventional blend value Rbob blend value Toluene fob minus gasoline 87M Mixed xylene 5211 minus gasoline 87M Jun 22 Jul 17 Aug 11 Sep Jun 22 Jul 17 Aug 11 Sep Page 2 of 7

3 Europe Toluene Toluene prices fell on Friday as the gasoline market declined further. The gasoline pool was the main market driver, with blenders continuing to bid for product mainly above a $/t premium to gasoline as demand for octane components was firm. Bid premiums were also bolstered by a tight supply of octane in Europe. Producers continued to focus on their contractual obligations as, with prices hovering around blend values, they were unable to cover further extraction costs. This left available product in the region scarce. Mixed xylenes MX ended the week lower as gasoline prices eased. In the German distribution market, MX prices were discussed at around a 30/t premium to toluene as market participants indicated upcoming refinery turnarounds had the potential to impact supply. Eurobob oxy-grade fell by $3/t to $516.75/t. The five-day average declined by $1.45/t to $519.60/t. PX prices were unchanged on Friday as Singapore was closed for a public holiday. Discussions for the September PX contract price were ongoing with expectations for a reduction compared with August following weaker Asian prices and falls in feedstock MX over the past month. Europe prices Paraxylene premium to naphtha Timing Low-High ± 30-day average Toluene fob NWE Sep Mixed xylenes fob NWE Sep Paraxylene fob NWE Sep Contract prices Timing Low-High ± Toluene Sep Paraxylene /t Aug Related markets Naphtha 65 para NWE cif Gasoline 95r 10ppm NWE cif Ice Brent $/bl Oct S/t Jun 22 Jul 17 Aug 11 Sep Toluene premium to Eurobob Europe paraxylene premium to mixed xylenes Jun 22 Jul 17 Aug 11 Sep Jun 22 Jul 17 Aug 11 Sep Page 3 of 7

4 Asia-pacific Toluene There is no Asia Pacific assessment due to a public holiday in Singapore. Asia prices Timing Low-High ± MTD Toluene fob S Korea na-na na Toluene fob S Korea na-na na Toluene fob S Korea na-na na Toluene fob S Korea marker na na na Toluene cfr China na-na na Toluene cfr China na-na na Toluene cfr China marker na na na Toluene East China dom Yn/t na-na na Toluene India dom ex INR/kg na-na na Mixed xylenes fob S Korea na-na na Mixed xylenes fob S Korea na-na na Mixed xylenes fob S Korea marker na na na Mixed xylenes cfr Taiwan na-na na Mixed xylenes cfr Taiwan na-na na Mixed xylenes cfr Taiwan marker na na na Paraxylene fob S Korea na-na na Paraxylene fob S Korea na-na na Paraxylene fob S Korea marker na na na Paraxylene cfr Taiwan na-na na Paraxylene cfr Taiwan na-na na Paraxylene cfr Taiwan marker na na na Paraxylene cfr China na-na na Paraxylene cfr China na-na na Paraxylene cfr China marker na na na PTA China domestic Yn/t na-na na PTA cfr China na-na na PTA future China Yn/t na na Related markets Naphtha Japan c+f na na Dubai na na Asia-Pacific deals Date Product Price Size t Delivery Page 4 of 7

5 Aromatics news STB unclear on handling of rail service shutdowns It is not clear how the Surface Transportation Board (STB) would handle a railroad that chose to suspend freight and passenger service rather than operate while out of compliance with the mandate to have positive train control (PTC)technology installed by 31 December, the board s chairman recently told a Republican senator. STB chairman Dan Elliott wrote in a letter to senator John Thune (R-South Dakota) that the railroads might be able to lawfully suspend service despite a common carrier obligation, and that the Federal Railroad Administration (FRA) would need to be consulted before a governmental response is determined. Elliott in the letter said it appears that some railroads are considering suspending all freight and passenger service beginning 1 January on lines where PTC will be required by then. Thune, chairman of the Senate Commerce Committee, has taken the lead on a PTC extension proposal since his oil-heavy state has a strong interest in keeping crude trains moving. The seven Class I railroads serving North America this week told Thune, Elliott and heads of other federal agencies that they might suspend freight and passenger traffic across tens of thousands of miles of rail lines if Congress does not extend the deadline. Railroads have said for years they will not make the deadline Congress mandated in the Rail Safety Improvement Act of 8 (RSIA) to install PTC, a $9bn hardware and software system designed to keep trains from colliding. Thune had written Elliott in late August, asking what information STB has sought from railroads, which factors railroads would consider in deciding whether to suspend service, and how the board would handle the service snarls that would result if the deadline is not extended. The common carrier obligation, which requires railroads South Korea PX-toluene, BZ-toluene, MX-toluene spreads PX minus toluene BZ minus toluene MX minus toluene 50 0 Singapore toluene-gasoline blend value Toluene premium to cfr Japan naphtha cfr Taiwan paraxylene premium to MX Page 5 of 7

6 to provide service pursuant to a reasonable request from shippers, is not absolute, and railroads can lawfully suspend service for a number of reasons, including safety, Elliott said. Previous cases in which STB has evaluated service embargoes were fact-specific, and the board has never evaluated a case in which a carrier suspended service because it was out of compliance with federal law. I cannot predict the outcome of such a case, Elliott told Thune. My expectation is that the view of the FRA, which has primary jurisdiction over rail safety in general and over implementing RSIA in particular, would be a critical consideration. Previous cases involved services that were suspended, but the carrier still complied with safety regimes administered by the FRA and the Pipeline and Hazardous Materials Safety Administration. A PTC deadline extension and possible repeal of a requirement to install electronically controlled pneumatic brake rule were included in HR 22, the Developing a Reliable and Innovative Vision for the Economy Act. The bill, which also extends federal transportation programs for six years, passed the Senate on 29 July. But the House has not acted on a transportation bill. Philadelphia Energy Solutions restarts reformer Philadelphia Energy Solutions restarted an octane-producing unit earlier this week at its 300,000 b/d refinery in Philadelphia, Pennsylvania. The refiner reported starting up a reformer on 8 September, according to a filing to city health officials. Philadelphia Energy Solutions operates the east coast's largest refinery. The restart comes amid above-average prices for octane-demanding premium grades in the New York market. Phillips 66 Ponca City begins turnaround work Turnaround work was underway today at Phillips 66's 194,000 b/d refinery in Ponca City, Oklahoma. The refiner did not identify the units involved or the duration of the work. Refiners are moving toward the traditional fall turnaround season, with most activity focused in the midcontinent. The company has ongoing work underway at its 356,000 b/d joint venture Wood River refinery in Roxana, Illinois. Rhine water levels approach critical level Water levels at the key measuring point at Kaub on the Rhine stand at 77cm today and are forecast to drop to 68cm on 15 September, limiting products traffic and pushing rates higher. Barge operators say water levels of 50-60cm at Kaub will result in severe limitations on loading. As a result of the dropping water levels, freight rates have increased for all destinations today. Freight rates to Karlsruhe and Frankfurt from ARA have gone up by 3/t for 1,000-1, tonne gasoil barges, and by 9/t for ARA to Basle. Low water levels have also limited heating oil deliveries to storage facilities in Florsheim, Bendorf and Koblenz and led to a shortfall of product there. Some German oil traders are switching to rail or road to avoid high barge freight rates. At the current water level, barges can load only roughly two-thirds of their capacity if going no further south than Cologne. If the barge's destinations is south of Kaub, loading capacity is diminished further as the section of the Rhine around Kaub is shallower. A 2,500t gasoil barge will only be able load t for destinations past Kaub such as Frankfurt, Karlsruhe and Basle. Various factors determine the limitations on loading capacity caused by low water levels, such as the type of boat with heavier double hull barges suffering greater constraints as well as the destination of the barge. The lowest recorded water level at Kaub was at 35cm in 3. ExxonMobil continues Baton Rouge ramp-up ExxonMobil continued work to restore normal operations nearly a week after a power outage at its 500,000 b/d refinery in Baton Rouge, Louisiana. The company confirmed ongoing work at the refinery today and said the facility continued to meet contractual commitments. Storms cut power to the refinery around 11pm ET on 5 September. ExxonMobil has not commented on the units affected by the outage, or as to which units remained under startup operations today. Spain refinery output up by 8.6pc in July Spanish refinery production increased sharply in July from a year earlier, as refiners ramped up output to make up for lost production in June when two of Spain's eight working refineries undertook maintenance work, as well as taking advantage of continued growth in domestic demand and strong refining margins, particularly for gasoline. Spain processed 5.75mn metric tonnes (1.35mn b/d) of crude in June and turned out 5.68mn t of petroleum products in July, up by 8.6pc from a year earlier, according to strategic petroleum reserves institute Cores. The country's inventories of crude and other refinery feedstock increased by 13.9pc in July to 7.2mn t from the same month a year earlier. Inventories of products increased by 11.7pc to 10.9mn t in July from a year earlier. The increase in inventories reflected a 25.6pc year-on-year surge in crude imports for the month and, together with news Page 6 of 7

7 that Spain's dominant refiners Cepsa and Repsol are delaying refinery turnarounds set for the fourth quarter, suggests that refiners expect the growth in domestic demand and refining margin strength to continue until at least the end of the year. Gasoline output was up by 32.7pc at 229,000 b/d in July from a year earlier, with refiners boosting output to serve high US demand and take advantage of record crack spreads for the fuel. LPG production declined by 8.7pc to 3,700 tonnes per day (t/d) in July from a year earlier, after increasing by 8.1pc in June. Butane output was practically unchanged at 2,900 t/d increased by 21.4pc to 3,400 t/d, while propane production was 31.6pc lower at 800 t/d. Naphtha output more than trebled to 24,000 b/d in July from a year earlier after doubling year on year in June. Spain is seeing a surge in naphtha production in 2015 thanks to higher margins for the petrochemical feedstock and the aromatics derived from it. Naphtha output from Spanish refineries averaged just 7,400 b/d in Fuel oil production increased by 8.5pc in July to 77,000 b/d from a year earlier. Fuel oil is used as a marine fuel and for power generation in Spain's Canary Islands. Petroleum coke output fell by 6.4pc in July from a year earlier to 9,900 t/d in July from a year earlier. BP Rotterdam refinery workers to reject pay deal Workers at BP's 400,000 b/d Rotterdam refinery will reject a pay deal on Monday, Dutch trade union FNV said today. The workers were offered a 1pc pay rise, but will formally reject the deal on 14 September, on the grounds that current strong refining margins allow for a bigger increase. The union may present BP with an ultimatum if the company does not respond with a better offer, but no strike is currently planned. Phillips 66 Wood River unit malfunctions An unidentified unit malfunctioned today at Phillips 66's 356,000 b/d Wood River joint venture refinery in Roxana, Illinois. The refiner reported increased emissions beginning at 11:45pm ET and continuing for 75 minutes, according to a filing to state hazardous materials monitors. Phillips 66 has confirmed planned maintenance underway at the site on multiple units. The company operates the refinery in a joint venture with Canadian integrated firm Cenovus. Announcement Because of a public holiday in Singapore there will be no Mideast Gulf or Asia-Pacific assessments on Friday 11 September. Argus Dewitt Toluene and Xylenes Daily is published by the Argus Media Group Registered office Argus House, 175 St John St, London, EC1V 4LW Tel: Fax: sales@argusmedia.com ISSN: Copyright notice. All rights reserved. All intellectual property rights in this publication and the information published herein are the exclusive property of Argus and/or its licensors and may only be used under licence from Argus. Without limiting the foregoing, by reading this publication you agree that you will not copy or reproduce any part of its contents (including, but not limited to, single prices or any other individual items of data) in any form or for any purpose whatsoever without the prior written consent of Argus. Trademark notice ARGUS, ARGUS MEDIA, ARGUS DEWITT, the ARGUS logo, ARGUS DEWITT TOLUENE AND XYLENES DAILY, other ARGUS publication titles and ARGUS index names are trademarks of Argus Media Inc. Visit for more information. Disclaimer The data and other information published herein (the Data ) are provided on an as is basis. Argus makes no warranties, express or implied, as to the accuracy, adequacy, timeliness, or completeness of the Data or fitness for any particular purpose. Argus shall not be liable for any loss or damage arising from any party s reliance on the Data and disclaims any and all liability related to or arising out of use of the Data to the full extent permissible by law. Publisher Adrian Binks Chief executive Neil Bradford CEO Americas Euan Craik Global compliance officer Jeffrey Amos Commercial manager Karen Johnson Editor in chief Ian Bourne Managing editor Jim Kennett Editor Amy Strahan Tel: txdaily@argusmedia.com Customer support and sales Technical queries technicalsupport@argusmedia.com All other queries support@argusmedia.com Houston, US Tel: New York. US Tel: Washington DC, US Tel: London, UK Tel: Astana, Kazakhstan Tel: Beijing Tel: Dubai Tel: Moscow, Russia Tel: Rio de Janeiro, Brazil Tel: Singapore Tel: Tokyo, Japan Tel: Petrochemicals illuminating the markets Issue Ref: