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Europe: NWE spot benzene slump briefly halted on back of Asian climb

https://www.chemnet.com   Mar 14,2011 Platts
The recent slump in Northwest European benzene prices was briefly halted Friday morning, with a $33/mt rise in the Asian market briefly pulling European levels $10/mt higher in early trading.

After closing at $1,230/mt for March and April Thursday evening, March bids were seen at $1,240/mt Friday morning, with offers heard at $1,250/mt for 1,000 metric ton CIF ARA barges. An apparent increase in March buy interest reopened a backwardation to April, with next month seen at a range of $1,230-1,245/mt.

The rise followed an increase of $33/mt in the FOB Korea market, which closed at $1,174/mt as the market reacted to a massive 8.9-magnitude earthquake that struck the eastern parts of Japan in the afternoon of the Asian trading day.

Following the initial rise, the market then cooled however, with one trader noting that "bids [are] running" while a second source added: "I tried to take the March bid [of $1,240/mt] out, but there was nobody out there."

Sources said that this suggested the fundamental problems that had brought a drop of $137/mt in European benzene prices this week.

"It was a little stronger after the news from Asia and I bought this morning, but it now looks weaker again. The fundamentals show that March is long," one source said.

Indeed, by 1230 GMT there were reports of March being traded at $1,230/mt, before moving to a range of $1,220-1,230/mt.

There did still seem to be a backwardation between March and April however, with one source saying April was at a discount of $10/mt to March.

The source added that this could reflect further Asian imports expected to arrive in Europe in April.

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