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The butadiene prices have been following the softening trend after hitting multi-year high level during mid-October 2016; yet surges three digits this week to reach $1670/ton FOB Korea term. This has encouraged ABS producers to implement similar hike on their cargoes in an attempt to cover production costs.

A distributor offered Taiwanese ABS at $1700/ton CIF Vietnam, LC AS term, a $100/ton increased from last month said, “Looking at the upstream costs, we fear that prices might hit the $1800/ton threshold in the coming days. Our customers just could not accept such large hike and many have not responded to the new offer.”

In China, Taiwanese ABS has reached the $1800/ton mark this week with supplier claiming strong energy and feedstock costs to be the main reason. A buyer informed, “Other suppliers are still maintaining at $1700-1710/ton CFR China term, however market acceptance is very low.”

Tight supply might keep butadiene costs on the high side in the near term, yet weak demand might limit the extent of ABS price increment, players said.