Styrene in Asia reaches 9 weeks high, further increases are expected

The Asian styrene monomer market has constantly following the firming trend after hitting the cyclical bottom during late October, thanks to strong buying interest from Chinese buyers in the wake of year-end replenishment activities. Compared to 30 October, styrene based on FOB South Korea has surged nearly $145/ton hit hit above the $1300/ton threshold for the first time in 9 weeks. Also contributed to the increases is the resilient energy complex.

Industry participants are expecting this firming trend to persist in the near term citing steady buying interest from Chinese customers. “Bids for SM are coming in for late December shipment has reached $1340/ton CFR China term, $10/ton higher than the current level for the same term,” an international trader said.

Besides, supply is tightening in both local and import market. Sources are reporting a quick falling in local inventory leading to surging domestic prices for SM in China too. “We might have to cut export allocation for SM to China by up to 50% during frst quarter next year due to plant shutdown. However, things are not finalised yet,” a South Korean producer added.

As a result of hiking SM costs, downstream PS market rose sharply this week. On an average, import GPPS to China leap $60/ton, while Southeast Asian buyers are seeing $40-50/ton increased. A Southeast Asian buyers received offers for Thailand GPPS at $1420/ton CIF, $40/ton higher than last week added, “There is no room for negotiation. The supplier insist to close deal at offered price.”

Another Philippines buyer received Singaporean HIPS offers at $1680/ton CIF said, “Prices are too high now. We are discussing with the suppliers to obtain some discount on deals.”