Europe August styrene to fall as US imports arrive

16 July 2010 12:00  [Source: ICIS news]

LONDON (ICIS news)--European styrene prices are expected to fall in August as demand slows down for the summer holiday period and a raft of imports being shipped from the US arrives, sources said on Friday.

Low prices in the US styrene market had opened the arbitrage window for European players, and sources said up to 20,000 tonnes of cargo had already been earmarked for export in July.

“These volumes will be arriving in August,” said one trader. “[US] suppliers have not quite been selling at a loss, but they have been aggressive with their [low] numbers. The lower production costs allow them to do this.”

One major European buyer said: “We have 5,000 tonnes already on the water for August arrival. The slowdown over summer will perhaps not be as sharp as in 2008 or 2009, but there will still be a dip in activity from July.”

“[With the summer slowdown] combined with the arrival of US imports, the market will move into oversupply,” the buyer added. “August numbers will fall like the price of vuvuzelas after the World Cup.”

However, another industry player felt that the market could tighten first.

“Will it get lower?” the player said. “Demand from key downstream markets is still very healthy. We could actually see some prompt tightness for the end of July and the beginning of August.”

($1=€0.78)

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By: Truong Mellor
+44 208 652 3214

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