28 February 2012 09:53 [Source: ICIS news]
By Clive Ong
SINGAPORE (ICIS)--Asian acrylonitrile-butadiene-styrene (ABS) producers may hold on to their current offers given high feedstock costs, despite recent falls in values of a major raw material butadiene (BD), traders said on Tuesday.
ABS offers are at a wide range this week at between $2,100-2,250/tonne (€1,575-1,688/tonne) CFR (cost and freight) NE (northeast) ?xml:namespace>
Trades in late February saw prices falling to the low $2,100/tonne
Spot prices of general purpose ABS were assessed at an average of $2,130/tonne CFR NE Asia in the week ending 24 February, down $15/tonne week on week, tracking the decline in BD prices, according to ICIS.
BD spot prices fell $125/tonne week on week to $3,800/tonne CFR NE Asia on 24 February, ICIS data showed.
Resin producers in the region expect buying activities to improve in April, when factories in
“Demand may start to emerge in April but high ABS prices will likely dampen buyers’ enthusiasm,” said a producer in
ABS producers are expected to keep offers in the high $2,100/tonne CFR NE Asia and even at above $2,200/tonne CFR NE Asia levels, as the costs of other main feedstocks used in production, namely, styrene monomer (SM) and acrylonitrile (ACN), remain high, market source said.
“While BD prices have eased other feedstock like styrene and acrylonitrile prices are still high, so the overall costs structure for ABS is still elevated,” said a producer.
Spot ACN prices were stable at an average of $2,175/tonne CFR NE Asia, ICIS data showed.
Styrene prices, on the other hand, averaged $1,470/tonne CFR China on 27 February, up $5/tonne from 24 February, according to ICIS.
ABS demand in the region has slowed down as end-users are balking at the high resin prices, which have been on an uptrend from around $1,800/tonne CFR NE Asia in mid-November 2011.
End-users have secured production contracts for finished goods but have based their resin costs on lower prices in November and December last year. The strong uptrend in ABS prices since caught many of them by surprise, given that the fourth and first quarters of the year are typically characterised by low prices because of low demand.
Negotiations between end-users and clients on possible alteration of end-product prices to reflect higher ABS prices have had limited success so far.
“With end-users now hesitant to pick up ABS resins due to the high prices, overall demand will likely remain slow in the near term,” said a trader in
ABS is a resin used in the manufacturing of office equipment, consumer electronics, toys and in the automotive sector.
($1 = €0.75)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections