Rising feed to dominate the market dynamics of Paraxylene

Asia-pacific witnessed an increase in its paraxylene market owing to the fluctuating feedstock prices. Due to the high selectivity of Paraxylene, its production using toluene has been gaining attention since long ago as it is more efficient than the existing process on an environmental basis. Therefore, Feedstock toluene was observed to rise with the volatile crude oil prices after Libya's supply disruption. As per the ChemAnalyst database, the price for Paraxylene in China rose by 4% and settled at USD 1200/MT FOB Shanghai on 22nd April.

The ongoing protest against Libyan Prime Minister Abdul Hamid Dbeibah, which has impacted crude oil production and loading from that country, has also put an impact on crude oil futures. Following this, the oil production at the E1 feed oil field was halted along with ceased cargo loading at Libyan ports. Furthermore, oil prices have also been supported by a tighter supply dynamic post sanctions against Russia, which caused the price of its derivatives also to rise.

China National Petroleum Corporation is the largest producer of Paraxylene, with an annual report of more than 1 million tons production capacity. Paraxylene demand is mostly from Purified terephthalic acid, which is the raw material for Polyethylene terephthalate bottles. Meanwhile, seeing the current pandemic situation in China, the production units have minimized their operating load. From the consumer's end, the demand from downstream industry seemed lifted this week, with higher orders coming from the Polyethylene terephthalate bottle industry. Inline port congestion outside Shanghai, one of the busiest ports, is also witnessing supply disruption with a higher number of ships waiting outside the ports to be delivered.

As per ChemAnalyst," Paraxylene prices are expected to remain robust with fluctuating feedstock Naphtha prices. The demand for downstream Purified terephthalate is rising with higher inquiries from the packaging sector. Thus, the paraxylene market is anticipated to witness positive market dynamics.