Benzene market attitude looks bearish
December 18, 2008 - Global
Even though few of the raw materials for the textile industry came out of the shadow of global recession, benzene market prices failed to move upward on the back of lower demand and plunging crude prices.
Asian benzene market was flat on Wednesday, FOB Korea closed at US $322.00-$323.00 per ton, South-East Asia closed down by $1 per ton to reach to US $299.00-300.00 per ton as bearish sentiment continued to plague the market. Traders are expecting the prices to drop further in late January and thus buyers in Southeast Asia and Northeast Asia left market together in wait-and-see attitude.
In contract market, due to uncertainty about market future, buyers in Southeast Asia concluded deals as lowest as possible. Usually, benzene buyers conclude 70-80 percent contract purchase and 20-30 percent remaining demand are covered by cash purchases, but in 2009, the average amount of contract purchase may drop to 50-60 percent.
Huge tons of benzene was sold to Asian market from the United States since December, while exports from the United States were 56,340 tons and 57,453 tons in September and October. In general, Asia is a major source for US benzene imports with about 4-5 million tons every month in form of cash purchase or contract purchase.
Today Prices in the Asian region slipped in the afternoon to $310-$320 per ton FOB Korea with an offer price quoted at $320 per ton FOB Korea for January shipment. The offer range for February stood at $315-$340 per ton FOB Korea.
In the European region, spot benzene levels slipped by $5-$15 per ton range from previous levels to $310-$330 per ton CIF ARA (Amsterdam, Rotterdam, Antwerp) for December. It is expected that prices for January would be quoted higher at $345-$355 per ton CIF ARA.
In the US benzene spot market speculative prices for December narrowed at 103-110 cents/gallon, compared to 100-113 cents per gallon previous day.
For World market prices click here