09 September 2008 21:46 [Source: ICIS news]
HOUSTON (ICIS news)--SABIC Innovative Plastics lifted its sales allocation for North American acrylonitrile-butadiene-styrene (ABS) as feedstock butadiene (BD) supplies loosened, sources close to the situation said on Tuesday.
Increases in crude oil prices caused cracker operators to lightened their feedstocks and brought about a chronic BD shortage, forcing SABIC to place its ABS and styrene-butadiene-rubber (SBR) customers on a 75% sales allocation in July.
BD supplies are now ample enough for the company to return ABS production to previous levels by 1 October, a source said.
“SABIC said on 1 October the allocation is being withdrawn. Everything is supposedly loosened up,” a distributor said.
The company did not say it would end its force majeure (FM) on SBR, a second distributor said.
Calls to SABIC were not returned.
SABIC’s FM, plus a two-week August maintenance turnaround at the 160,000 tonne/year INEOS ABS plant in Addyston, Ohio, left buyers scrambling for material, sources said.
It also lent support for a 25 cent/lb price hike that producers nominated earlier. ABS was assessed on Friday at 120-135 cents/lb ($2,646-2,976/tonne or €1,879-2,113/tonne) DEL (delivered), according to global chemical market intelligence service ICIS pricing.
Suppliers said heightened BD prices made the increase necessary, but some market participants have recently countered that longer BD supplies should bring stable, possibly lower, ABS prices in October.
For more information on ABS, BD and SBR, visit ICIS chemical intelligence.
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