07 February 2012 22:13 [Source: ICIS news]
HOUSTON (ICIS)--US expandable polystyrene (EPS) prices rose this week, as February price hikes began to be implemented, market sources said on Tuesday.
US prices rose on average by 5 cents/lb ($110/tonne, €84/tonne) for all grades of EPS, based on higher feedstock costs, including benzene and styrene, sources said. The February benzene contract settled up by 50 cents/gal to $4.20/gal, though prices at the beginning of the month were below the $4/gal mark.
"We are still short when you look at where styrene has been trading," said one producer, explaining why the increase was necessary.
The increase comes on the heels of a successful 4-6 cents/lb price hike implemented in mid-January.
Buyers, who said they are frustrated by back-to-back increases, agreed that the 5 cent/lb price increase had been implemented.
But some buyers said the repeated price hikes have caused them to turn away from US producers and buy cheaper Asian imports instead.
"The pricing from the domestic suppliers has now increased to the point that the Asian pricing is more attractive," said one buyer, who said it hasn't bought anything from domestic suppliers since the 1 February increase was announced.
Even as buyers expressed frustration at the higher prices, producers announced another round of increases.
BASF announced a 3 cent/lb increase, effective on 16 February, according to a customer letter obtained by ICIS.
Two other producers were heard to have announced a 4 cent/lb increase, effective on 1 March, according to market participants.
US EPS prices were assessed by ICIS at 93-97 cents/lb for package material and 95-99 cents/lb for block material.
Major North American EPS producers are BASF, NOVA Chemicals, Flint Hills Resources, Styrochem, Nexkemia.
($1 = €0.76)
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