Styrolution to no longer supply PS grades from Marl unit in Germany

12 September 2012 15:55  [Source: ICIS news]

LONDON (ICIS)--Styrolution will no longer supply polystyrene (PS) grades from its 180,000 tonne/year unit in Marl, Germanyafter 15 October, Pierre Minguet, vice president of the styrenics major's business management for PS in Europe, the Middle East and Africa, said on Wednesday.

“It was a decision we communicated in March,” Minguet added.

Both general purpose polystyrene (GPPS) and high impact polystyrene (HIPS) are produced at the Marl site.

This most recent closure follows a series of permanent shutdowns in the PS industry that began in 2005-2006, followed by another spate of shutdowns in 2009, estimated to be at least 25% of installed capacity at the time.

Closures occurred as PS usage has declined over the years, and was hit particularly hard by advances in the electronics industry, like flat-screen and MP3 technology.

“In PS more recently we have seen substitution from PS to PP [polypropylene] and also recycled PET [polyethylene terephthalate),” said Minguet, “but the weakness of the economy has also played a significant role.”

“We are also determined to improve our margin and tune our capacity down, in line with demand. We will be able to supply our customers’ needs from our remaining plants in France, Belgium and Sweden,” he said.

He estimated Marl PS capacity to be around 8% of Europe’s overall PS demand.

PS producers and their buyers have been faced with close-to-record high styrene prices in 2012, that they are having difficulty recovering. September spot styrene prices are now reaching levels of $1,800/tonne (€1,404/tonne) FOB (free on board) Rotterdam. In June, prices were below $1,300/tonne FOB Rotterdam.

PS producers have announced increases for September, based on high costs. Settlements are not yet fully concluded for the month, but buyers confirm that prices will rise.

Average GPPS prices in Europe are reported around €1,500/tonne FD (free delivered) NWE (northwest Europe) on a net basis at medium-sized accounts.

PS is used widely in packaging and household good sectors.  

($1 = €0.78)

By: Linda Naylor
+44 20 8652 3214

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