The arbitrage window for Asian benzene cargoes headed to the US Gulf Coast is open again after remaining shut for almost three weeks, according to Platts data.
Based on the latest assessments, the FOB US Gulf-FOB Korea spread at $74.89/mt is $8.89-13.89/mt higher than the current freight rate of $61-66/mt for a 10,000 mt cargo of benzene from South Korea to the US Gulf, providing a margin for players attempting to work the arbitrage.
The current margin is the widest in almost three weeks. On May 19, the margin was $15.05/mt.
FOB Korea benzene was assessed at $1,303.50/mt on Wednesday, down $8/mt from Tuesday as discussions showed a softening in price levels. July FOB US Gulf benzene, meanwhile, was just 1 cent/gal lower at 461 cents/gal or $1,378.39/mt. On Tuesday, July FOB US Gulf benzene surged 10 cents/gal amid stronger export demand for downstream styrene.
The Asia-to-US arbitrage window shut on May 21 after being open for more than five months, Platts data showed. The five-month window -- the longest that it has remained open since Platts started assessing the US marker in January 2003 -- opened on December 16 when the Asia-US benzene spread was $1.83/mt higher than the assessed freight rate of $63/mt.
