15 April 2011 23:59 [Source: ICIS news]
LONDON (ICIS)--Prices in the European expandable polystyrene market have fallen by an average of €30/tonne to €1,470-1,550/tonne ($2,130-2,246) in April, according to an assessment by ICIS.
The €30/tonne FD (free delivered) average reduction almost exactly mirrored the increase that was seen in March and reversed the trend of recent months for higher prices that had been spurred on by rising styrene monomer costs.
The decline in prices for April contracts was widely forecasted by EPS players once the substantial reduction in styrene monomer numbers was known in the first few days of the month. There was a speedy consensus that lower monomer costs would be reflected in a drop in EPS values but that producers would be resolved to limit the reduction, and successful in retaining most of the raw material decline.
The reason for the partial reduction in EPS prices was largely the acknowledged need for producers to restore severely depleted margins. Compared with the €80-95/tonne fall in styrene, they had therefore managed to secure an increase in the spread of around €50-60/tonne.
Despite the increase in margins that this month’s settlement represented for EPS producers, there was a feeling that there was still some way to go. One major supplier commented that, apart from styrene, other raw material costs, such as flame retardant additives, had become more expensive, saying “margins are still really poor for producers”.
($1 = €0.69)
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