US ABS spot prices rise on feedstock costs

03 February 2012 18:49  [Source: ICIS news]

HOUSTON (ICIS)--US acrylonitrile butadiene styrene (ABS) domestic prices rose as three producers pushed forward as much as an additional 5 cents/lb ($110/tonne, €84/tonne), market sources said on Friday.

The increases, attributed to increasing feedstock costs, became effective on Wednesday and include those sought by INEOS ABS for 3 cents/lb for all of its ABS material; SABIC for 5 cents/lb for its extruded pipe and sheet ABS products; and Styron for 5 cents/lb for its ABS.

The higher end of the ABS domestic prices for each type, impact grade and quantity level increased by 5 cents/lb to reflect the producers’ increases.

Buyers questioned the amount of the increases to some extent, but, at the same time, said they understand when feedstock costs rise, producers are going to pass on the increases to their customers.

One buyer said it appears that ABS producers are playing up the rising cost of feedstock butadiene and the subsequent tightness in the market as justification for their push for higher prices.

The buyer said a majority of the purchases are for restocking efforts and are not indicative of market performance at this point. If the strength continues through mid-February, the buyer said the sentiment may change.

Looking at the costs of feedstocks, the January contract price for butadiene (BD) of $1.05/lb, increased over December’s contract average of $0.98/lb. The February contract price has settled, split at $1.18 and $1.30/lb.

Although contract prices for feedstock acrylonitrile (ACN) had decreased in December, spot prices have increased by an average of $197.5/tonne since December. The January ACN contract will be determined after the February propylene contract settles. Feedstock styrene contract prices narrowed from November to December, but remained at an average of 61 cents/lb.

The new domestic price ranges for ABS are: 130-145 cents/lb for medium impact extrusion material in bulk; 133-148 cents/lb, medium impact, extrusion, package; 135-140 cents/lb, high impact, extrusion, bulk; 138-153 cents/lb, high impact, extrusion, package; 125-140 cents/lb, medium impact, injection, bulk; 128-143 cents/lb, medium impact, injection, package; 130-145 cents/lb, high impact, injection, bulk; and 133-143 cents/lb, high impact, injection, package.

More proposed price increases loom, although the upper range of ABS domestic prices will remain the same.

SABIC has proposed a price increase of 5 cents/lb for the balance of its ABS material, while Styrolution is seeking 5 cents/lb more for its ABS, both effective on 13 February.

A 5-cent/lb increase sought by Network & Diamond Polymers – the fifth of five producers to request price increases – is effective on 1 March.

If all five producers’ increases are instituted, the low end of the domestic prices would rise to reflect the new range.

Also, on 1 March, two ABS producers will seek addition increases on materials that have already seen upward movement in price. INEOS is seeking its second increase in ABS prices of 11-cents/lb. SABIC will seek an additional 7 cents/lb for its ABS extruded pipe and sheet material.

That would bring the total increase for this year for INEOS to 14 cents/lb and 12 cents/lb for SABIC for these materials.

ABS producers in the Americas include INEOS ABS, Network & Diamond Polymers, SABIC Innovative Plastics, Styrolution and Styron.

($1 = €0.76)

By: Wesley Busch
+1 713 525 2653

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