วันพฤหัสบดีที่ 17 พฤศจิกายน พ.ศ. 2554
วันพุธที่ 16 พฤศจิกายน พ.ศ. 2554
Asian benzene prices fell $8/mt day on day November 15 to be assessed at $980/mt FOB Korea following a drop in US prices on November 14. The US benzene price on November 14 was assessed at $917.90/mt FOB USG.
Arbitrage opportunities for Asian cargo to the US continue to remain closed, but a reverse arbitrage situation is looking closer to reality with the slip in the November 15 Asian benzene price being comparably smaller than the plunge in the US. South Korea exported 99,430 mt of benzene in October, down 22.4% month on month and 17.4% year on year, latest Korea Customs Service data showed November 15.
Exports to the US declined 58.1% month on month and 47% year on year to 23,613 mt due to the closed arbitrage to the US and Asia being the most expensive region globally for benzene in the month. In Europe November 14 the benzene price was assessed at $920.50/mt CIF ARA. (See chart 1)
Asian toluene on an FOB Korea basis was assessed at $1,102.50/mt November 15 down $27/mt from the day before, amid declines in upstream energy. December ICE Brent traded at $113.13/barrel at 4:30 pm Singapore time (0830 GMT), down $1.32/b day on day.
The Asian price remained at a sharp premium to the US toluene price, which was assessed November 14 at $1,021/mt FOB USG. The European toluene price was assessed Monday at $1,082/mt FOB Rdam. (See chart 2)
Asian isomer-grade mixed xylenes closed November 15 at $1,189.50/mt FOB Korea and $1,199.50/mt CFR Taiwan, down $15/mt and $13/mt, respectively, on the back of weaker crude and equity markets. In the US, the mixed xylene price on November 14 was assessed at $1,036/mt FOB USG. (See chart 3)
Vessel space on the US-Asian shipping route remained tight, with US-South Korea freight rates heard in the range of $80-$85/mt and US-China freight rates at $80-$100/mt. "[There is] no space and it is not a matter of price," a South Korean trader said.
Asian paraxylene fell $13/day on day November 15 to settle at $1,432/mt CFR Taiwan/China despite buyers being out in force seeking cargoes. Downstream purified terephthalic acid slipped $4/mt over the same period to close at $1,068/mt CFR China for Taiwan origin cargoes.
With more PTA plants cutting operating rates or shutting down in December, as well as around 30,000 mt of deep-sea PX arriving in late December, supply could ease a little, sources said. In production news, China's Sinopec Zhenhai Refining & Chemical Company, or ZRCC, has lowered its paraxylene operating rate to 60% in November due to technical problems with the plant, a company source said November 15.
The US paraxylene price was assessed at $1,332.50/mt FOB USG. The European paraxylene price was assessed at $1,345/mt FOB USG. (See chart 4)
Asian styrene monomer for H1 December was assessed down $5/mt day on day November 15 to $1,311/mt FOB Korea tracking lower energy prices and overall weaker sentiment as global economic concerns ticked up again. The market appeared quiet November 15; sources said sellers were holding their offers at similar levels to November 14 but buyers were not active in the market.
Surging European SM prices could attract some cargoes from Asia, a trader said, but it was not confirmed that any shipment deals had been done. However, sources were concerned that only the prompt European market was firm enough to digest any arbitrage cargoes. The European market is in a $110/mt backwardation from November to December, with November assessed at $1,520/mt FOB Korea and December at $1,410/mt FOB Korea November 14. The US styrene price was assessed at $1,227/mt FOB USG Monday. (See chart 5)
All of the charts featured were built on Platts on the Net. The formulas we use are estimates to illustrate industry-wide trends. Subscribers to Platts on the Net can modify the formulas to better reflect their own assumptions. If you are a Platts on the Net subscriber, and would like access to these charts or the formulas used to build them, or for more information about Platts on the Net, please contact Jim Foster at
วันศุกร์ที่ 11 พฤศจิกายน พ.ศ. 2554
Cells and Chips
The Asian benzene market continued to fall for a second day November 10, with the benchmark FOB Korea marker moving down $15.50/mt day on day to $984.50/mt. Sentiment was hit by weaker crude oil prices amid continuing macroeconomic concerns, especially in the eurozone.
Benzene sellers in Asia have found it difficult to sell their cargoes outside the region with the arbitrage window to the US firmly shut, but demand in many parts of Asia was heard to be weak. In the US November 9 the benzene price was assessed at $956.80/mt FOB USG. In Europe, the benzene price November 9 was assessed at $921.50/mt CIF ARA. (See chart 1)
In plant news, Japan's Tosoh plans to shut its aromatics unit for a one-month turnaround in mid-March 2012, a company official said November 10. The unit can produce 154,000 mt/year of benzene, 65,000 mt/year of toluene and 32,000 mt/year of mixed xylenes.
Asian toluene on an FOB Korea basis was assessed at $1,115.50/mt November 10, shedding $37/mt or 3.2% compared to the day before as sentiment turned bearish on eurozone concerns and falling regional equities.
Front month ICE Brent crude futures traded at $112.45/barrel at 4:30 pm Singapore time (0830 GMT), down $2.54/b from the day before, while CFR Japan naphtha sank $13/mt day on day to be assessed at $888/mt. The European toluene price was assessed at $1,102/mt FOB Rdam. The US price was assessed at $1,048/mt FOB USG. (See chart 2)
Asian isomer-MX tumbled $27 day on day November 10 in tandem with downstream paraxylene, closing at $1,178.50/mt FOB Korea and $1,193.50/mt CFR Taiwan. The market was jittery as traders were closely monitoring PX's movements, which started falling earlier in the day. The US price remained well below the Asian price, with the assessment November 9 at $1,033/mt FOB USG. (See chart 3)
Asian paraxylene tumbled $39/mt day on day November 10, erasing gains November 9 amid worsening downstream purified terephthalic acid, renewed eurozone worries and falling crude. The CFR Taiwan/China marker was at $1,432/mt. Market sentiment was extremely weak as PTA plunged early in the day, with South Korean-origin cargoes heard traded at $1,030/mt CFR China and discussion levels for Taiwan-origin PTA at around $1,050/mt CFR China, down $40/mt or 3.67% on day.
The plunge was exacerbated by PTA futures on China's Zhengzhou Commodity Exchange, which saw the most heavily traded January contracts losing Yuan 266/mt ($42/mt) or 3.27% on day. "With PTA doing so badly, buyers are all scared," a Chinese trader said. "No one wants to be caught in a falling market," he added. In the US November 9, the paraxylene price was assessed at $1,362.50/mt FOB USG. The European PX price was assessed at $1,371/mt FOB Rdam. (See chart 4)
Asian styrene monomer prices fell $24/mt day on day November 10 to $1,292/mt FOB Korea on economic concerns. In plant news, Japan's Denki Kagaku Kogyo, or Denka, will shut each of its SM plants for about 40 days' maintenance in 2012, a company source said Thursday. Its 240,000 mt/year SM plant at Chiba will shut in May, while the 270,000 mt/year plant operated by Denka's 60% owned subsidiary Chiba Styrene Monomer Company will shut in November. Also, Nippon Steel Chemical plans to shut both its SM plants at Oita for maintenance in 2012, a company source said November 10.
In downstream news, China's Tianjin Dagu Chemical has delayed the startup of its new 200,000 mt/year acrylonitrile-butadiene-styrene plant in Tianjin due to poor market conditions, a source close to the company said November 10. In the US November 9, the styrene price was assessed at $1,230/mt FOB USG, the lowest globally. In Europe, the December styrene price was assessed November 9 at $1,340/mt FOB Rdam. (See chart 5)
All of the charts featured were built on Platts on the Net. The formulas we use are estimates to illustrate industry-wide trends. Subscribers to Platts on the Net can modify the formulas to better reflect their own assumptions. If you are a Platts on the Net subscriber, and would like access to these charts or the formulas used to build them, or for more information about Platts on the Net, please contact Jim Foster firstname.lastname@example.org.
วันอังคารที่ 8 พฤศจิกายน พ.ศ. 2554
At present we are in the early stages of the latest Federal Reserve intervention, Operation Twist, which was officially announced on September 21 after several days of rumors. We've now seen several bouts of aggressive Fed attempts to manage the economy following the collapse of the two Bear Stearns hedge funds in mid-2007 about three month before the all-time high in the S&P 500.
Initially the Fed Funds Rate (FFR) underwent a series of cuts, and with the bankruptcy of Bear Stearns, the Fed launched a veritable alphabet soup of tactical strategies intended to stave off economic disaster: PDCF, TALF, TARP, etc. But shortly after the bankruptcy filing, the Fed really swung into high gear. The FFR fell off a cliff and soon bounced in the lower half of the 0 to 0.25% ZIRP (Zero Interest Rate Policy). The thud to the FFR bottom coincided with the first of two rounds of quantitative easing in an effort to promote increased lending and liquidity.
If a picture is worth a thousand words, this chart needs little additional explanation — except perhaps for those who are puzzled by the Jackson Hole callout. The reference is to Chairman Bernanke's speech at the Fed's 2010 annual symposium in Jackson Hole, Wyoming. Bernanke strongly hinted about the forthcoming Federal Reserve intervention that was subsequently initiated in November of 2010, namely, the second round of quantitative easing, aka QE2.
The lastest major strategy, Operation Twist, which was announced on September 21st, has just begun and will run through June 2012. The Fed will sell $400 billion of shorter-term Treasury securities and use the proceeds to buy longer-term Treasury securities in an effort to lower interest rates.
Prior to the much-rumored "Twist" announcement, the yield on the 10-year note had been hovering around 2.19, which was 47 basis points above the historic closing low of 1.72 set a month earlier on September 22.
The FFR has been essentially at zero for three years. What has the 10-year note done since the "Twist" announcement? The interim high daily close was 2.42 on October 27th. The interim low was 2.01 on November 1st.
It's too soon, of course, to tell how successful the "Twist" strategy will be for lowering interest rates; the program is barely off the ground. According to the Freddie Mac survey, the 30-year mortgage rate has fluctuated between 3.94% and 4.18% since the first week in September, and the most recent average (as of November 3rd) is 4.00%. But we will watch Treasury yields and mortgage rates in the weeks ahead to see if Operation Twist lives up to the Fed's expectations.
The past three years have been an exciting time for many professional traders and their seasoned amateur counterparts. And it's been a dream-come-true for institutional HFT (high frequency trading) with computerized algorithms. Of course, there have been perils, even for seasoned pros, as thebankruptcy of MF Global illustrates.
On the other hand, savers — those benighted souls looking for income from CDs, Treasury yields, and FDIC insured money markets — have had a rude introduction to the new reality, one that will apparently be with us for a very long time.