APIC ‘08: Asia ABS surges $50-100/t on feedstock
28 May 2008 06:17 [Source: ICIS news]
SINGAPORE (ICIS news)--Acrylonitrile-butadiene-styrene (ABS) resins values are on the uptrend with prices of prompt parcels rising by some $50-100/tonne as firm feedstock costs squeeze margins, said producers on Wednesday.
Styrene monomer (SM) prices have risen more than $100/tonne over the past week to the high-$1,600s/tonne CFR (cost and freight) China, prompting ABS suppliers to implement massive hikes in prices this week, they added on the sidelines of the Asian Petrochemical Industry Conference (APIC) in Singapore.
Offers of prompt ABS parcels were quoted at $2,040-2,150/tonne this week, up by some $50-100/tonne from previous quotations.
"We continue to face problems covering costs at even $2,100/tonne," said a producer in Asia. Besides buoyant SM costs, acrylonitrile (ACN) and butadiene (BD) values had also breached the $2,000/tonne CFR northeast (NE) Asia threshold, putting additional pressure on ABS margins.
"ACN and BD make up around 40% of ABS, which is a significant portion of total resin cost," the producer added.
While offers had increased sharply, fixtures remained limited as end-users were reeling from the successive price hikes. Most continued to use existing inventories and hoping that prices would ease soon.
"Buying momentum is slow at above $2,000/tonne and it is currently difficult to conclude business at $2,100/tonne," said another NE Asia producer.
However, most suppliers agreed that higher prices were needed to maintain a workable margin or else most manufacturers would have to further scale back production.
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By: Clive Ong
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