Lotte Chemical : South Korea's Lotte Chem signs 12-month naphtha deal as premiums sink

SINGAPORE (Reuters) - South Korea's Lotte Chemical Corp has signed a one-year naphtha deal with sellers at about $1.50 a tonne above Japan quotes cost and freight (C&F), at least four times cheaper than a contract expiring in June.

The petrochemicals maker sealed the deal this week, at a time when naphtha fundamentals are weak because of high supplies.

Traders said that refineries processing lighter grades of crude had resulted in higher yields on light fuels.

Maintenance at several petrochemical units that use naphtha feedstock has also hit fundamentals.

Lotte Chemical's existing contract for up to 900,000 tonnes of naphtha scheduled for delivery between July 2018 and June 2019 was signed in late May last year at a premium of $6-$7 a tonne.

The new deal is for August 2019 to July 2020.

(Reporting by Seng Li Peng; Editing by David Goodman)