Argus Media Limited

10/20/2021 | News release | Distributed by Public on 10/20/2021 03:34

Korean naphtha imports hit 20-month high in September

South Korea's naphtha imports hit a 20-month high in September amid firm demand for petrochemical products and healthy cracker cash margins.

South Korea imported 821,706 b/d of naphtha in September, the highest since 842,774 b/d in January 2020, according to GTT data. The September imports were also up by 7.6pc from 763,418 b/d in August and by 42.6pc from 576,065 b/d a year earlier. Russia was the top supplier to South Korea at 148,687 b/d, followed by the UAE at 112,435 b/d.

Refiners and petrochemical producers in South Korea bought a total of at least 500,000t of spot naphtha for September delivery, according to Argus data. The uptick in naphtha imports could be a result of firm demand for the feedstock, alongside strong global demand for petrochemical products.

Naphtha cracker cash margins also remained in healthy territory in all of September, ranging between $77/t and $234/t during the month and incentivising cracker operators to run at full capacities. Naphtha remains the preferred feedstock for petrochemical producers with propane cracker cash margins deep in negative territory.

The addition of two new naphtha-fed crackers by South Korean petrochemical producers LG Chem and GS Caltex also likely boosted naphtha demand over the past few months. LG Chem and GS Caltex started up their 800,000 t/yr and 700,000 t/yr crackers in June and July respectively, which combined can process up to 4.5mn t/yr or 110,000 b/d of naphtha as a feedstock.

By Vanessa Liu