29 July 2008 17:02 [Source: ICIS news]
LONDON (ICIS news)--Players in the European styrene market are gambling on a potentially lucrative arbitrage window from Asia into the region despite the potential for losses on the long shipping period, market participants said on Tuesday.
Traders and brokers reported that upwards of 20,000 tonnes of styrene had been fixed from locations in Asia landing in ARA (?xml:namespace>
“It’s a long shot,” said one trader. “Some of this hasn’t even loaded. The product won’t come until September, and given the imports from the
Two loads, of 7,000 tonnes and 2,000 tonnes, were mooted from
A third load, of 12,000 tonnes, was also widely discussed as being fixed from
Traders were taking the risk of shipping material to
Any August styrene was being offered at $1,840/tonne FOB (free on board)
The latest indications for Asian spot styrene were given at $1,575-1,590/tonne FOB
The high end of this range would still be $180/tonne lower than September values in
Traders, however, said that bringing material in from Asia was a tricky move, given that a large volume of styrene was expected to arrive in early August from the
Another trader said that the potential profit made the risk worthwhile, however.
“The prompt market has been in the $1,800s/tonne for quite a while now,” the trader said.
“If we see prompt tightness creeping back in after the
On top of the 2,000 tonne styrene vessel was a further 8,000 tonnes of monoethylene glycol (MEG). The recent drop in Asian spot and rise in European numbers has also led to traders looking to import MEG to
Another trader said last week it had agreed material from the
Bulk Europe spot was pegged between €820-870/tonne CIF (cost, insurance, freight) NWE (northwest Europe), well above Chinese levels of $985-995/tonne CFR (cost and freight), according to ICIS pricing.
($1 = €0.63)
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