Singapore
Singapore
Singapore
prices remain strong with close to no spot availability for April and most
refiners sold out for the month. Negotiations for May shipments have already
started, say market sources.
Producers hoping to bank on volatile crude prices are pushing for prices around $260/t fob for late April and up to $260-265/t fob for May. But other market participants are more wary of these bullish price expectations, citing relatively low current production costs and the unwillingness of Chinese buyers to pay high prices.
With the supply situation tight at the moment, one producer is said to be negotiating for May spot shipments and making offers to buyers in Indonesia and Thailand at slightly above $260/t fob. Offers by the same refiner to Vietnam are believed to be slightly lower.
The recent Indonesian ban on sand exports and detaining of granite barges to Singapore has slowed down a number of construction projects in the country. The reduced domestic demand has also affected domestic asphalt prices and Singapore rack offers have dropped about $15/t from a few weeks ago, say market sources.
Prices in general are being boosted by tight availability and expectations that demand in the region will pick up in the later part of April and May when more road building projects begin.
Malaysia
Demand continues to be low this week as road building projects are
slowing down. Asphalt consumption is expected to pick up following the budget
announcements in April.
Truck-delivered asphalt prices from Singapore are believed to be unchanged this week at around $245/t and it is believed that there were no responses to offers made at $250/t for similar cargo.
Indonesia
The domestic price by state-owned refiner Pertamina is unchanged for
the month of April at $308/t. But market participants say a price increase in
May is possible on the back of strengthening prices in the region.
While demand in Indonesia is at a seasonal low ahead of the commencement of new projects for the financial year, Pertamina is estimated to have about 40,000-45,000t available for April.
Thailand
Most refineries in the country have no spot availability for the month
of April. The Alliance refinery in Rayong is fulfilling orders carried over
from an emergency shutdown in the mid-March. Thai Lube is said to have no spot
availability in April due to strong domestic demand.
A major refinery has recently settled cargoes at $250-260/t fob for Vietnam and $240-250/t fob for China to be delivered in April. But with expectations of stronger demand in May, the same refiner is said to be hoping to secure fob prices of above $250/t to China and slightly above $260/t to Australia for May.
Japan
There continues to be little spot availability for April and May as the
country enters its low production and demand season. With a number of refinery
shutdowns taking place throughout the country from April to June, production
levels are expected to drop by 30-35pc in that period. The start of the new
fiscal year in April will also see road construction projects slow down.
Major Japanese refineries Nippon Oil and Cosmo Oil are said to be negotiating prices for the next quarter with domestic buyers. This time, domestic prices are expected to drop about ¥1,000 yen/t ($8.50/t) from the current ¥42,000-44,000/t, as demand is at a seasonal low.
South
Korea
S-Oil, with
about 15,000t of spot availability for April, is said to be offering slightly
less than $250/t fob to buyers in China. This is up from about $230/t fob
offered at the start of the year. The offer is still viewed as slightly more
conservative than other producers in Asia-Pacific, and is due to high stockpile
levels in China. Building projects in China — a key importer of South Korean
asphalt — have yet to go into full swing, keeping Chinese demand muted.
SK Corp has reported that it has no spot availability for April as all its supplies for exports are tied up in term contracts.
South Korean producers are expecting prices to strengthen further in May, on the back of growing demand with the arrival of warmer weather.
China
Domestic prices by four to five refineries are up this week by
Yn50-100/t ($6.50-13/t) on steady demand. CFR prices remain unchanged at
$285-305/t from last week.
In south China, Sinopec Maoming and Guangzhou were heard to have both raised prices by Yn50/t respectively to Yn2,850/t and Yn2,750/t this week. Petrochina Gaofu is now said to be trading volumes at Yn2,700/t.
Demand in the south is slightly up on lower output in March at the Sinopec Maoming and Guangzhou refineries. The earlier high stock levels at the refineries have been depleted by strengthening demand.
A new tender was issued this week in Guangdong province, seeking 25,000t of asphalt. The tender is asking for 70pc modified grade and AH-70 road building grade for the remainder. A tanker with over 3,000t of asphalt was heard to arrive at Fangchenggang in Guangxi province from Thailand early this week. And another tanker arrived with 4,100t of asphalt from Shell in Singapore at Qinzhou in the same province this week.
Most refineries in east China were quiet this week except for Petrochina Wenzhou, which raised prices by Yn100/t to Yn2,800/t. CNOOC Taizhou was heard to be starting maintenance works in mid-April for 20 days. But Sinopec Zhenhai will raise its production volume in April from the usual 30,000t.
In northern Inner Mongolia, a new tender emerged this week asking for 128,316t of asphalt — over 60pc in AH-90 road building grade and the rest in modified grade. CNOOC Sichuan in southwestern China increased its traded price by Yn50/t to Yn3,100/t this week. The refineries continue to mainly supply to contract buyers in northeast China amid the present low stock levels.
Taiwan
Fob prices were unchanged at $255-260/t amid tight spot supply. Formosa was heard to have almost sold out its April cargo of around 10,000t. The refiner
has yet to begin the sale of May cargo. Another Taiwanese refiner, CPC, is
expected to begin the sale of May cargo around 10 April.
India
Prices remain unchanged this week and are likely to stay so for April as well.
Demand continues to be strong on the west coast and not much spot cargo is
available for export. But some market participants in southeast Asia have noted
that a few offers have been made in recent weeks, likely to be from the east
coast of India.
Domestic demand in India is expected to slow down from June to September with the arrival of wet weather and this should see more spot volumes available for export out of India.
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