The demand for Toluene is stable in the main trading hubs within India, mainly Ahmedabad and Mumbai. As a consequence of moderate demand, traders aren't increasing the prices despite the fact that they are selling imported toluene, which is slightly more expensive than domestically manufactured goods.
Indianpetrochem spoke to a trader in Ahmedabad who shed light on the current market situation for the aromatic in Gujarat. Based on market sources, it is revealed that traders in Gujarat have limited stock supplies of Toluene manufactured by Reliance, instead, they have ample supplies of imported Toluene. A trader shed light on this matter when they said that, " Even though the basic price of imported goods is higher than domestic products, traders prefer to keep imported stock as they have line of credit of 60 days from importers in the Middle East, etc. On the other hand Reliance doesn't offer the same line of credit to local traders and asks for cash on delivery".
As a result Reliance is selling the chemical directly to end user industries in the state.
The basic price for imports at Kandla increased by Rs. 1 to Rs. 79.5 per kg, for bulk purchases only, within two weeks. The ex factory price for Reliance and BPCL is Rs. 76 per litre for the aromatic.
Currently, the market prices in Mumbai and Gujarat for Toluene is Rs. 82-83 per litre in barrels.
Evaluating the market price trend for the aromatic in India, one can comprehend that at the beginning of the year, the price for aromatic dropped by Rs 1-2 to Rs. 80.5 per litre in Mumbai and Rs.88 per litre in New Delhi. Prices dipped by Re. 0.50- 1 in these markets on 7th January, 2014. However, the prices gained upward momentum on the 10th January, 2014, whereby the aromatic was selling at Rs. 82 per litre and Rs. 95 per litre in Mumbai and New Delhi, respectively. The prices have remained stable at these levels in the respective markets eversince.
There is an expectation that these market prices will roll over till February and March, based on feeble demand. A Mumbai based trader observed that market prices will pick up April onwards, based on strong cyclical demand for the aromatic. He speculated that during these months traders will try to square off their positions on expensive imports in the past.
The Indian market is dependent on imports to fulfill the demand-supply gap. According to the APIC, the installed capacity for Toluene in India is at 290, 000 metric tonne per annum while the actual demand was at 391, 000 metric tonne per annum in FY 2012. As such, the Indian market is heavily dependent on import price fluctuations.
By Ntasha Berry
ntasha.berry@indianpetro.com
Indianpetrochem spoke to a trader in Ahmedabad who shed light on the current market situation for the aromatic in Gujarat. Based on market sources, it is revealed that traders in Gujarat have limited stock supplies of Toluene manufactured by Reliance, instead, they have ample supplies of imported Toluene. A trader shed light on this matter when they said that, " Even though the basic price of imported goods is higher than domestic products, traders prefer to keep imported stock as they have line of credit of 60 days from importers in the Middle East, etc. On the other hand Reliance doesn't offer the same line of credit to local traders and asks for cash on delivery".
As a result Reliance is selling the chemical directly to end user industries in the state.
The basic price for imports at Kandla increased by Rs. 1 to Rs. 79.5 per kg, for bulk purchases only, within two weeks. The ex factory price for Reliance and BPCL is Rs. 76 per litre for the aromatic.
Currently, the market prices in Mumbai and Gujarat for Toluene is Rs. 82-83 per litre in barrels.
Evaluating the market price trend for the aromatic in India, one can comprehend that at the beginning of the year, the price for aromatic dropped by Rs 1-2 to Rs. 80.5 per litre in Mumbai and Rs.88 per litre in New Delhi. Prices dipped by Re. 0.50- 1 in these markets on 7th January, 2014. However, the prices gained upward momentum on the 10th January, 2014, whereby the aromatic was selling at Rs. 82 per litre and Rs. 95 per litre in Mumbai and New Delhi, respectively. The prices have remained stable at these levels in the respective markets eversince.
There is an expectation that these market prices will roll over till February and March, based on feeble demand. A Mumbai based trader observed that market prices will pick up April onwards, based on strong cyclical demand for the aromatic. He speculated that during these months traders will try to square off their positions on expensive imports in the past.
The Indian market is dependent on imports to fulfill the demand-supply gap. According to the APIC, the installed capacity for Toluene in India is at 290, 000 metric tonne per annum while the actual demand was at 391, 000 metric tonne per annum in FY 2012. As such, the Indian market is heavily dependent on import price fluctuations.
By Ntasha Berry
ntasha.berry@indianpetro.com
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