21 September 2012 23:59 [Source: ICIS news]
LONDON (ICIS)--European acrylonitrile-butadiene-styrene (ABS) September contracts have settled at an increase of €50-60/tonne ($65-78/tonne) on higher feedstock costs, buyers and sellers said on Friday.
To reflect this change, compounding grade (natural) was assessed at €2,185-2,205/tonne FD (free delivered) NWE (northwest Europe), injection moulding (natural) at €2,275-2,310/tonne FD NWE and extrusion grade (natural) at €2,200-2,310/tonne FD NWE according to ICIS.
September contract feedstock styrene settled at €1,410/tonne, an increase of €43/tonne. September European acrylonitrile (ACN) contracts have been settled at an increase of €120-125/tonne, buyers and a producer confirmed.
European ABS demand is being heavily reduced by poor macroeconomic conditions. A lack of end-use market confidence means distributors and buyers struggle to increase customer prices. Subsequently, buyers and distributors are reluctant to accept large price increases from producers, forcing producers to absorb growing raw material costs.
Additionally, a strong euro against the US dollar makes Asian imports far more attractive to European buyers, especially from South Korea because of the EU-South Korea Free Trade Agreement which has been running since July 2011. Producers expect to see more Asian materials appear in Europe in October, further pressuring suppliers to keep prices down, or at least stable.
One producer said that if demand does not increase into October, it will have to consider reducing production in order to cut costs.
Players singled out the automotive industry as being a key market that has suffered over the year, with new car registration down another 8.9% in August according to statistic from the European Automotive Manufacturers’ Association published on Tuesday this week.
Market sentiment is one of ‘wait and see’ as thoughts turn to October feedstock contract price discussions next week.
There were no problems with supply and product was available for purchase as and when needed.
($1 = €0.77)
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