07 January 2010 07:02 [Source: ICIS news]
By Clive Ong
PS sellers raised offers of general-purpose (GP) resins to around $1,450/tonne (€1,001/tonne) CFR (cost and freight) China this week, in a bid to maintain a workable margin.
"Some deals had been concluded in the low-to-mid $1,400s/tonne CFR China for GPPS," a trader in Hong Kong said.
The deal price was around $180/tonne higher than mid-December levels, according to global chemical market intelligence service ICIS pricing.
Several PS sellers planned to raise offers further next week in view of the relentless surge in styrene monomer (SM) costs, producers said.
Spot SM numbers rose to the mid-$1,300s/tonne CFR China this week, up 10% from mid-December levels of around $1,225/tonne CFR China, according to ICIS pricing.
Offers of expandable PS (EPS) were quoted at $1,450/tonne CFR China this week, up more than $100/tonne from mid-December quotations in the low $1,300s/tonne CFR China, the producers added.
"Some end-users had accepted EPS prices at $1,450/tonne CFR China as they were concerned that prices could rise further in the weeks ahead," a producer in Taiwan said.
While buying interest for PS and EPS had picked up this week, suppliers anticipated a stronger rebound in demand after the Lunar New Year holidays in mid-February. Manufacturing activities among factories in China typically starts picking up from late first quarter each year.
Offers of prompt ABS parcels reached $1,800/tonne CFR China this week, up more than $200/tonne from mid-December levels, traders said.
"We had no choice but to hike ABS prices sharply as raw material costs had jumped up," a producer said.
Apart from SM, prices of acrylonitrile (ACN) and butadiene (BD), the other components of ABS, had also posted large gains in the first week of the year, according to ICIS pricing.
Both ACN and BD values had increased above $1,800/tonne CFR NE (northeast) Asia prompting ABS producers to hike resin prices in order to cover production costs.
While the higher resin costs could ultimately cut into end-users’ margins, resin makers said higher prices were inevitable as their own margins were eroded.
"We had no choice but to increase resin prices. If customers cannot accept the price we would have to cut or stop production," a producer in northeast Asia said.
($1 = €0.69)For more on ABS, PS, SM, ACN and BD visit ICIS chemical intelligence
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