the asian petrochemicals market is likely to continue witnessing logistical issues in the trading week ending aug. 27, as regional governments impose containment measures to curb the covid-19 spread.
toluene** selling pressure is seen from south korea, which may pull asian complex lower. some india-based importers noted that pre-festive sales were proving to be weaker-than-usual. sentiment remained bearish on the southeast asia front, with term buyers, particularly in the vietnam market, heard requesting sellers to redivert their cargoes elsewhere, sources said.
** domestic china market was also stable-to-weaker, with domestic east china prompt ex-tank prices assessed lower. china's toluene price in local currency is relatively weak with sellers talking about export intentions.
isomer-mx** isomer-mx prices may remain under pressure as the spread to paraxylene has narrowed in recent weeks, and the october supply-demand balance is expected to be a tad long compared to september due to end-users' maintenance shutn.
** the market last week flipped from flat to backwardation and is likely to remain in such structure due to the difference in market balance in september and october.
** with a steep fall in prices globally last week -- n $60/mt at $763.50/mt fob korea -- an arbitrage from south korea and japan might open up if domestic chinese mx prices remain stable to firm.
meg** asian monoethylene glycol might extend falls on weak demand due to lower consumption in east china, given the resurgence of covid-19.
** logistical issues persisted since many provincial borders were closed to contain the spread of the virus.
methanol** the asian methanol market will look to europe for price direction in the week to aug. 27.
** fob rotterdam methanol prices may have been stable at eur425/mt or $496.44/mt on aug. 20, but any upside in europe will compel asian methanol prices to move higher.
** the availability of spot cargoes in china, south korea, taiwan and india remain tight as middle eastern producers allocate spot volume to europe.
** southeast asian, taiwan and south korean methanol were assessed $4-$10/mt higher on the week at $390-$395/mt aug. 20.
solvent-mx** the solvent-mx market in asia is likely to continue taking cues from crude oil prices and the entire aromatics complex in the week to aug. 27.
** the weakness in nstream demand for solvent-mx and higher inventory in china have been putting a nward pressure on prices.
