Counter bids for May Asian Contract Price for paraxylene were in a range of $1,040-1,100/mt CFR, sources close to the negotiations said Tuesday.
There are four PX ACP sellers in Asia -- ExxonMobil, Japan's Idemitsu Kosan and JX Nippon Oil and Energy, and South Korea's S-Oil.
Last week, JX nominated its May PX ACP at $1,240/mt CFR, ExxonMobil at $1,250/mt CFR, S-Oil at $1,250/mt CFR, and Idemitsu at $1,270/mt CFR.
There are six ACP buyers, namely: BP, Taiwan's Capco and Oriental Petrochemical (Taiwan) Corp., Japan's Mitsui Chemicals and Mitsubishi Chemical, and China's Yisheng Petrochemical. All of the buyers are purified terephthalic acid producers.
Sources close to the negotiations said counter bids were heard in a range of $1,040-1,100/mt CFR.
The sources added that negotiations for the May PX ACP would be tough as ACP sellers would be reluctant to reduce their nomination values because of a narrow spread between PX and feedstock naphtha prices.
"The ACP sellers would not reduce their nomination [to] less than $1,200/mt CFR because of negative margins," one of the sources said.
Based on Platts CFR Japan naphtha assessment Monday, the spread was calculated at $240/mt with the CFR PX value of $1,200/mt, below the typical breakeven point of $250/mt.
The negative PTA margins would also see ACP buyers reluctant to raise their counter bids quickly.
"The buyers would not accept $1,200/mt CFR," said another source. Based on PX price of $1,200/mt CFR, the PTA producers would lose $60 for every metric ton they produce.
The nomination values are due to expire on Wednesday.
