08 May 2007 17:52 [Source: ICIS news]
SAO PAULO (ICIS news)--Higher feedstock prices and scarce raw materials are threatening to slow growth in Argentina’s thriving expandable polystyrene (EPS) market, a source with a large transformer visiting Brasilplast said on Tuesday.
The surge in feedstock styrene monomer (SM) prices seen in the last couple of months has prompted two consecutive price increases in Argentina EPS, adding up to 12%, the source said.
In addition, a 4 cents/lb hike was said to be in store for the second half of May, although it was not certain if the local producers would implement them.
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With the economy growing at a robust 8.5%, demand for EPS has grown, straining supplies, the source said.
Local EPS resin producers are facing shortages of pentanes from local refineries and this is hampering EPS production.
Furthermore, the flourishing economy has produced a surge in salaries, bringing additional costs for manufacturers, the source added.
“With the new prices, we fear demand will suffer considerably,” the transformer said.
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