Massive explosions at TPC Group’s Port Neches petrochemical plant on Wednesday may reduce US butadiene exports to Asia; industry sources informed SSESSMENTS.COM. The US is the primary supplier of butadiene to Asia. Data from the United States International Trade Commission (USITC) showed that the US exported 7,433 tons of butadiene in August.
Market sources said that Asia would receive about 5,000 tons of butadiene in January. A trader noted that some Asian end-users might seek for spot butadiene cargoes to replace reduced supplies from the US. The latest sell tender from Taiwan’s Formosa of 2,000-ton spot cargoes for December may attract some buyers’ interest, according to market sources.
However, market sources expected no prices spike in Asia due to robust butadiene availability in this region, especially in Japan. The country exported 23,433 tons of butadiene in October, with 18,413 tons of them went to South Korea.
Some Asian traders said that some end-users would seek for spot butadiene cargoes in Europe following the fire. However, this would likely be temporary, considering unused butadiene capacity in the US. The US has a butadiene production capacity of 2.5 million tons/year, but only produced 1.4 million tons/year in 2019. These plants can increase their butadiene output as long as they can secure supplies of crude C-4, a trader said.
SSESSMENTS.COM's supply and demand database showed that on Wednesday, both the CFR China and the CIF USG butadiene prices were flat compared to the previous day, at $885/ton and $495.90/ton, respectively.
