FocusUS styrene at odds on price and supply

10 January 2008 22:37  [Source: ICIS news]

By Brian Balboa

HOUSTON (ICIS news)--Styrene plants in Texas and Lousiana belonging to four major producers were sold out of material for the spot market, straining supplies along the US Gulf coast, market participants said on Thursday.

Despite the talk of tight supplies, styrene traders and other producers contended material could be drawn from other plants in Louisiana and Canada, blunting upward price pressure.

LyondellBasell, Dow Chemical, INEOS NOVA and Westlake were identified as having multiple plants in Texas and one in Louisiana that were sold out of spot material.

The four companies have a combined capacity of about 3.4m tonnes/year, well over half the total North American capacity, according to global chemical market intelligence service ICIS pricing.

Two of the four companies did not return calls by ICIS news.

The other two companies would not comment on their supply situations but said a strain on supplies would  put upward pressure on spot prices.

Styrene traders and other producers said material could be drawn from other plants in Louisiana and Canada.

Styrene spot traders have assessed on Thursday prices at 58.00-58.50 cents/lb ($1,279-1,290/tonne) FOB (free on board) USG (US Gulf).

Styrene producers, however, maintained that spot prices were at 59 cents/lb, and they would not do spot business at 58 cents/lb.

“There's nothing available at 58 cents/lb,” a producer source said, adding that as of last week business was done at 59 cents/lb. “We have material available.”

“Traders are probably looking to keep prices at 58 cents/lb to take advantange of an arbitrage to Europe or Asia,” another producer said.

January styrene spot levels in Europe were at $1,340-1,360/tonne FOB Rotterdam, overseas trade sources said.

In Asia, traders have said February styrene spot levels were at $1,315-1,325/tonne FOB Korea.


By: Brian Balboa
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