* At least 1.4 million T western naphtha arriving in Feb
* Asian demand expected to soak up most cargoes
* Cold snaps in the U.S. choke off cheap LPG
By Seng Li Peng
SINGAPORE, Jan 24 (Reuters) - Asia is expected to get at least 1.4 million tonnes of western naphtha in February, mainly from Europe and the Mediterranean, and already about 800,000 tonnes were on provisional bookings for arrival mostly in first-half of March, traders said.
The above-average quantum of naphtha inflows into the region is unlikely to dampen a surge in the feedtstock's margin given robust recent demand from Brazil and price volatility in alternative liquefied petroleum gas (LPG).
Although the February volumes will be at least 17 percent lower than the record volumes seen for January arrival, at 1.7 million, they will still be higher than 2013's monthly average of 1.1 million tonnes.
"If you factor in cargoes that were delayed from January to February due to rough weather in the west, the total volumes arriving in February are estimated to be around 1.7 million tonnes," said a Singapore-based trader on Friday.
The Asian naphtha margin, the premiums/losses of refining Brent crude into naphtha, an indicator of demand for the feedstock, was at $153.15 a tonne on Jan. 23, about 32 percent higher than 2013's average.
Some Asian crackers are able to replace 5 to 15 percent of their naphtha feedstock with LPG, which is also used for heating purposes in the west.
"But LPG has been unpredictable, with prices coming off one minute before roofing in the next," said a Singapore-based trader.
LPG prices rose recently due to the unusual U.S. cold snap.
The United States is due for another Arctic plunge over the next five days and is trending even colder over the next six to 10 days, weather forecaster MDA Weather Services said on Jan. 23.
Asia's top naphtha importer Formosa Petrochemical Corp, for instance, was only able to buy small quantities of LPG and had to continue buying large amounts of naphtha.
The Taiwanese refiner and petrochemical maker paid up to $11 a tonne premium to Japan quotes on a cost-and-freight (C&F) basis on Jan. 23 for 150,000 tonnes of first-half March cargoes.
This was similar to what it had paid about a week ago for second-half February cargoes, a reflection that sellers were in no hurry to reduce prices despite the repeated high volumes of western cargoes coming in.
"There are about 800,000 tonnes of naphtha coming in during March, but these are mainly for first-half March," said a North Asian trader. "It is unclear if the volumes will catch up in second-half March but Brazil has pulled away some U.S. and even Mediterranean naphtha cargoes away from Asia."
A fire hit Brazilian state-run oil company Petrobras's 242,000 barrels per day (bpd) REDUC Refinery in suburban Rio de Janeiro in January. (Editing by Muralikumar Anantharaman)