India’s LAB under pressure to increase on firm feedstock, tighter supply

SINGAPORE (ICIS)–Linear alkylbenzene (LAB) prices in India are under pressure to increase because of firm upstream crude and benzene values, as well as tighter supply.

(Source: Helmut Meyer Zur Capellen/imageBROKER/REX/Shutterstock)

According to ICIS assessment on 17 April, prices in India were at $1,250-1,276/tonne CFR (cost & freight) India.

This week, import offers to India for flexi-tanks were heard at $1,320-1,330/tonne CFR India on a non anti-dumping (ADD) basis, which is equivalent to $1,300-1,310/tonne CFR India on bulk basis.

Deals were concluded at $1,275-1,285/tonne for May loading for both bulk and flexi-tanks.

Most suppliers to India raised their offers this week on the back of buoyant crude market.

Apart from firm crude futures, a soaring benzene market has also provided a fillip to LAB prices amid positive macroeconomic indicators including upbeat Chinese economic data.

US crude futures topped $66/bbl, while Brent crude bested $74/bbl in recent trades.

Meanwhile Indian Oil Corp (IOC), a major LAB domestic producer, is in talks to source additional crude from suppliers in Saudi Arabia, Kuwait, Abu Dhabi, the US and Mexico, a company source said.

In addition, given a shortage of benzene in Iran, other LAB suppliers to India were bullish on tightened supply.

“Without Iranian material, the entire market will move up,” said a domestic Indian producer.

Orders for prompt loading at about $1,285/tonne CFR India were also heard, which also suggested that Indian supply was shorter.

“Demand is definitely rising in India, with Nirma still on shutdown,” said an Asian importer.

Focus article by Yuanlin Koh