South Korea's Lotte Chemical Restarts Yeosu Cracker — OPIS

About this update from Lotte Chemical Corporation

Lotte Chemical resumed operations at its Yeosu cracker on Wednesday after a two-month maintenance and is currently ramping up production, a source familiar with the matter said.The restart came ahead of the original early June schedule. The cracker was taken offline in late March, earlier than its initial April plan, due to difficulties securing feedstock, OPIS reported previously.Operating rates following the restart could not be confirmed.The Yeosu cracker is flexible and can consume both LPG and naphtha feedstocks. It has a production capacity of 1.2 million metric tons per year of ethylene and 620,000 mt/year of propylene, according to OPIS data.The source added that June and July propane cracking volumes are expected to remain below 50,000 mt per month, while butane cracking volumes are expected to be below 30,000 mt per month. Prior to the Middle East war, propane cracking volumes averaged around 70,000 mt per month; for butane, it averaged around 35,000 mt per month.Market participants were not surprised by the lower cracking volumes, noting that sentiment remains cautious as fresh military action between the U.S. and Iran continued despite discussions of a possible peace deal. Many buyers were still adopting a wait-and-see approach amid uncertainty surrounding supply and prices."Both LPG and naphtha markets have been quiet with limited buying demand. There is still too much uncertainty, so buyers are only purchasing minimum volumes needed to keep plants running," a Northeast Asian source said.News of a potential peace deal did little to revive spot market activity despite recent price declines on expectations of easing supply tightness. No naphtha tenders were tracked this week, while only two LPG tenders emerged in the market.The CFR Japan propane flat price and CFR Japan naphtha flat price closed at $867.25/mt and $835.63/mt, respectively, on Tuesday, according to OPIS assessments.This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.Reporting by Cheryl Lee, [email protected] ; Editing by Mei-Hwen Wong, [email protected]

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