Asia: The week ahead in petrochemicals, w/c Jan 2

Singapore (Platts)--2 Jan 2018 256 am EST/756 GMT

Here's a quick look at the factors driving petrochemical markets in Asia this week.


The paraxylene market can continue to find support this week from end-user demand in the purified terephthalic acid segment. China's BP Zhuhai Chemical Co. Ltd. will restart its 1.25 million mt/year PTA plant this week after two weeks of scheduled maintenance that began December 17.

Strength in the downstream styrene monomer, caprolactam and phenol markets will also lend support to the Asian benzene market this week.

SM supply is anticipated to remain tight after China's CSPC unexpectedly shut its 700,000 mt/year Huizhou SM plant in southern Guangdong province last week. The shutdown is expected to last 15 days.

Article continues below...

Download our special report:
ASEAN: Emerging among giants


The Association of Southeast Asian Nations is set to have a significant impact on energy and commodities in the coming decades, as the region’s demand climbs due to favorable geography and demographics.

Download our latest special report to read about the challenges and opportunities in ASEAN's commodity landscape

As a result, inventories in East and South China are likely to be drawn down this week, as end-users actively procure prompt cargoes to offset the supply shortfall. Inventories were at 57,700 mt and 6,200 mt last week in East and South China respectively, below the year-to-date average of total 85,500 mt for both regions.

In upstream toluene, demand is expected to pick up as market participants return from the holiday season lull in the South Korean and Chinese markets.


Ethylene prices finished 2017 on a 10-month high last Friday, buoyed by firm demand and tight supplies. Spot demand is likely to remain firm this week amid slow negotiations for 2018 term contracts.

Market sources said initial offers for 2018 term ethylene were at a premium of $80/mt to a CFR Northeast Asia-related formula, around $30-$35/mt higher than a year earlier.

In propylene, industry participants are optimistic of conditions this week, with demand expected to pick up from procurement ahead of the Lunar New Year in mid-February.

Butadiene markets were thin last week due to the year-end holidays and several term discussions were prolonged. As such, butadiene markets are expected to be stable this week as deepsea offers for early February hover at $1,200/mt CFR Northeast Asia.

In China, buyers have covered their requirements for January and partially for February. Buying interest is expected from South Korea and Taiwan, and several Asian tenders are expected for February loading.


Methanol markets may encounter some resistance this week following a tumble in Chinese prompt domestic prices last week, retracting from a supply-driven market which brought prices to more than three-year highs.

Inventory levels at eastern and southern Chinese ports were heard to be recovering slowly, cumulatively up 2.6% on the week at 341,600 mt, signaling an improving supply-side situation.

Asian MTBE spot market activity is expected to pick up this week, with support from stronger gasoline and energy markets.


Asia's low density polyethylene market was stable last week amid thin trade. Many market participants were closed for the year-end holidays and liquidity is expected to return post-holiday.

--Desiree Quah,
--Edited by Irene Tang,

Related News & Analysis

Latest Platts videos Commodities Spotlight podcast archive News features The Barrel blog

Related Products & Events

Asian Petrochemicalscan

Copyright © 2018 S&P Global Platts, a division of S&P Global. All rights reserved.