16 June 2010 05:01 [Source: ICIS news]
SINGAPORE (ICIS news)--Spot prices of polystyrene (PS) in China have declined to the lowest point this year amid tepid domestic demand due to moulders concerns over Europe, producers and traders said on Wednesday.
Offers of general purpose (GP) PS slipped to the mid-$1,200s/tonne (€972/tonne) CFR China this week, from around $1,430/tonne CFR China at the start of the year, according to data from global market intelligence service ICIS pricing. (Please see graph below)
“Offers at $1,250/tonne CFR China failed to interest buyers who expected even lower numbers,” said a SE Asia producer who sells to China and Hong Kong.
With feedstock styrene monomer (SM) trading below $1,100/tonne CFR China, buyers of PS expected resin prices to ease under $1,200/tonne CFR China, given the typical $100/tonne spread.
PS end-users were deemed to have low inventories from weeks of limited purchases but they continued to keep away from the market, traders said.
“Uncertain demand with reductions or cancellations of orders from clients in Europe had prompted them to be cautious”, said a trader in SE Asia who sells into China.
The debt crisis in the eurozone had weighed on the sentiment of moulders in China who faced not only cancellation of orders but a weak euro eating away the profits of their contracts denominated in dollars.
“The situation is Europe would continue to play out for some time, but the Chinese export sector should be able to weather that as far as we can see for now," said a Japanese producer.
GPPS is used in the packaging, consumable items, utensils and toys sectors.
($1 = €0.81)
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