26 January 2012 07:36 [Source: ICIS news]
SINGAPORE (ICIS)--Asian styrene monomer (SM) prices remained at their high levels this week despite the Lunar New Year holiday across Asia, traders said on Thursday.
“The demand for February and March cargoes remains strong as regional availability is tight”, a South Korean trader said.
In addition, Asia’s supply is expected to be tight in the near term amid several plant turnarounds in the region from February to April.
Japan’s Asahi Kasei and Idemitsu Kosan, and South Korea’s Samsung Total Petrochemicals and Yeochun NCC (YNCC) have scheduled turnarounds for their SM facilities during this period.
SM consumption is expected to rebound after the Lunar New Year holiday as the demand for styrenic resins, such as polystyrene (PS) and acrylonitrile-butadiene-styrene (ABS), is likely to improve, a second South Korean trader said.
“Resin inventories among factories in China are low as they have not been actively buying since November last year,” a resin trader in southeast Asia said.
Consequently, factories in China are expected to replenish their resin stock to prepare for higher production, which usually starts in April.
In addition, SM demand will improve if resin consumption picks up as expected.
“While SM prices are likely to improve in the near term, it is far from being a certainty as the global economy remains fragile,” an SM trader in Singapore said.
The ongoing debt problems in the eurozone, weak economic conditions in the US and tension between the US and Iran are expected to dampen demand for Asia-made products, a southeast Asian buyer said.
As a result, the demand for resins may be weaker than expected and will have a negative impact on SM consumption.
SM is a liquid chemical used to make plastic resins like PS and ABS as well as synthetic rubbers, such as styrene-butadiene-rubber (SBR) and styrene-butadiene-latex (SBL).
($1 = €0.76)
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