Asia's naphtha crack rose 5.4 percent to reach a four-session high of $98.43 a tonne on Wednesday after falling close to a six-week low on Monday. Strong demand for term cargoes by buyers this week and last to cash in on falling spot prices caused by high supplies has given the market some support.
Spot prices for open-specification naphtha scheduled for first-half October delivery to Yeosu, South Korea, flipped to discount levels on Tuesday. LG Chem was among the first in South Korea to buy naphtha for second-half October delivery.
Traders said the buyer paid a premium of about $1 a tonne to Japan quotes on a cost-and-freight (C&F) basis but this could not be confirmed as LG Chem does not comment on its deals. Details on the number of cargoes bought or delivery ports were not available.
Indonesia's Pertamina, also Asia's top gasoline importer, was seeking heavy naphtha which traders said could be used for gasoline production. Pertamina does not regularly import heavy naphtha but is now looking for parcels for September 1-10 and September 10-20 arrival at Tuban.
The cargo size is set at a minimum of 400,000 barrels and a maximum of 550,000 barrels. Pertamina's tender closes on August 31, with offers staying valid until September 3.
Sri Lanka's Ceypetco has received the highest bid for 120,000 barrels of naphtha scheduled for end-September loading from Dolphin port, Colombo, from Trafigura at a discount of close to $4.70 a barrel to Singapore quotes on a free-on-board (FOB) basis.