Wires

Asia Naphtha-Taiwan's Formosa defers shipments to Nov

SINGAPORE, Oct 9 (Reuters) - Taiwan's Formosa PetrochemicalCorp has delayed receiving two naphtha shipments to Novemberfrom October after it cut operating rates at its 2.93 milliontonnes per year (tpy) naphtha cracking complex, traders said onTuesday.

Formosa, Asia's top naphtha buyer, cut its crackers' runrates to about 80 percent of capacity in late Septemberfollowing a fire at a monoethylene glycol (MEG) plant operatedby its sister company Nan Ya Plastics.

Naphtha is cracked into ethylene, among other hydrocarbonproducts. Formosa supplies some ethylene to Nan Ya Plastics tobe made into MEG, which is used in the production of polyester(PET) resins, among other things.

Traders estimated the shipments to be deferred likelytotalled about 60,000 tonnes of naphtha, or about 40 percent ofapproximately 150,000 tonnes Formosa had bought last month forOctober delivery to Mailiao.

The cracking complex will operate at the reduced ratethroughout October, which would result in a loss of nearly160,000 tonnes of naphtha demand this month.

It had already cancelled a tender to buy November naphthaafter the fire at the MEG plant.

Traders said the decision to defer the 60,000 tonnes waslikely made 1-1/2 weeks ago.

(Reporting by Seng Li Peng; Editing by Alison Birrane)

((lipeng.seng@thomsonreuters.com)(+65 6870 3086)(ReutersMessaging: lipeng.seng.reuters.com@reuters.net))

Keywords: NAPHTHA TAIWAN/FORMOSA