Asia styrenics' upswing takes a breather

17 August 2010 08:10  [Source: ICIS news]

SINGAPORE (ICIS)--The uptrend in Asian polystyrene (PS) and acrylonitrile-butadiene-styrene (ABS) resin prices has tapered off this week after gaining 8-10 % from mid-July, industry sources said on Tuesday.

After several weeks of active purchases due to the rebound in prices of feedstock styrene monomer (SM), as well as low inventories among end-users amid the traditional pick-up in manufacturing activities in August and September, buyers had retreated to the sidelines.

"Buyers are taking a pause this week after replenishing some stocks," said an ABS producer.

Spot prices of general purpose (GP) PS held steady at around $1,240/tonne (€967/tonne) CFR (cost and freight) China, while ABS was unchanged at $1,950/tonne CFR China, according to ICIS.

“It is natural for buyers to step back temporarily after picking up stocks. They will probably come back to the market after several weeks when inventories dwindle,” said a trader in Hong Kong.

The manufacturing sector in China typically enters its peak season from August as factories churn out finished products for exports, which boosts resin consumption during the third quarter of the year.

However, with the US and eurozone economies remaining sluggish this year, demand for China-made products might not be as strong as in the previous years.

“It is likely that demand for end-products and consequently, styrenic resins, will be lower compared to last year,” said a PS producer.

“But consumption of resins should still improve in the near term due to the manufacturing season,” the producer added.

PS is used in the packaging, utensils and consumer electronics sector. ABS is in to make office equipment, consumer electronics, automotives and toys.

($1=€0.78)

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By: Clive Ong
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