LG Yongxing may cut ABS rate on margin squeeze

16 July 2008 09:59  [Source: ICIS news]

SHANGHAI (ICIS news)--China-based Ningbo LG Yongxing Chemical would likely cut operating rates at its acrylonitrile-butadiene-styrene (ABS) plant due to squeezed margins, a company source said on Wednesday.

“Skyrocketing feedstock prices and low demand plagued our margins severely,” the source said, declining to elaborate how much it would cut the operating rate.

"We will not rule out the possibility of price hikes if the operating rate reduction does not offset losses."

BD has surged around $1,180-1,250/tonne to $3,050-3,150/tonne CFR CMP (China main port) from early May, while SM also increased $205-230/tonne to $1,645-1,690/tonne CFR CMP.

The 500,000 tonne/year ABS plant, located in Ningbo city, in the eastern Chinese province of Zhejiang, is the largest ABS in China, followed by Zhenjiang Chimei’s 350,000 tonne/year unit and a 300,000 tonne/year facility operated by Formosa Chemical and Fibre Corp (FCFC) in Ningbo .

The company is a joint venture of LG Chem and China’s Yongxing Chemicals.

($1 = €0.63)

Paris Lv from CBI contributed to this article
For more on ABS visit ICIS chemical intelligence
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By: Judith Wang
+65 6780 4359

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