08 March 2010 09:00 [Source: ICIS news]
By Clive Ong
SINGAPORE (ICIS news)--Asian styrene monomer (SM) prices snapped their week-long losing streak with spot prices gaining ground on Monday due to a rebound in energy and feedstock benzene values, but ample supply may keep it under pressure, traders said.
Bids for April parcels were heard around $1,230/tonne (€898/tonne) FOB (free on board) Korea, up some $10-15/tonne from Friday.
"A sole bid was heard up to $1,250/tonne FOB Korea but had since been withdrawn," a broker in Singapore said.
The rebound in energy values over the weekend with the Nymex crude futures nearly touching $82/bbl appeared to have bolstered sentiment in the Asian petrochemical markets.
"Some buyers emerged this morning to place bids; it appears that sentiment might have turned cautiously bullish," another broker in Singapore said.
Meanwhile, buoyant benzene values provided further ballast to the SM uptrend. Price discussions for May lots of benzene were above $900/tonne FOB Korea on Monday morning after declining to the mid-$800s/tonne FOB Korea last week, traders said.
Some traders attributed the sudden rise in benzene prices to short-covering activities following the run-up in energy prices.
SM players continued to monitor the demand situation as ample supply continued to threaten any potential price recovery.
"We have to monitor the price movements further to see if the uptrend is sustainable," a trader said, adding that the market still had quite a lot of inventories to digest.
Spot values had fallen to the low $1,200s/tonne FOB (free on board) Korea on Friday, from $1,300/tonne FOB Korea in the second half of February, according to global chemical market intelligence service ICIS pricing.
"Ample availability in the region coupled with weak feedstock benzene values weighed on SM numbers," a Korean trader said.
Inventories along the eastern Chinese shore tanks were at around 90,000 tonnes last week, up from 60,000 tonnes in the second half of February.($1 = €0.73) To discuss issues facing the chemical industry go to ICIS connect
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