03 September 2013 23:14 [Source: ICIS news]
HOUSTON (ICIS)--Polioles, one of the two Mexican producers of expandable polysterene (EPS), on Tuesday announced to increase prices starting in mid-September, saying it had to make up for gains in values of feedstock styrene, according to market sources.
Prices will rise starting 16 September by 2 cents/lb ($44/tonne, €33/tonne), according to a company letter sent to customers and obtained by ICIS.
The higher price comes on top of a 3 cent/lb increase that the company announced in late July and which was implemented for some customers in August for what would be a total 5 cent/lb increase for the past two months.
“The reason for this increase is the continuous rise in prices of styrene prices, a key feedstock used in the production of expandable polystyrene. This price increase is necessary to reflect costs being incurred to produce our material,” the company letter said.
“Order quantities will be limited to typical historical volumes or as otherwise specified by written agreement,” the letter added.
The increase comes even as demand for block, or modified EPS, in Mexico has been slowing down as spending in construction in the country has fallen in recent months as a result of a decrease in housing related social spending by the government.
However, demand for package quality EPS has been growing at a 2-3% annual rate as most of that material is used by Mexican plants that export goods to the ?xml:namespace>
Polioles also exports to markets in South and
Sources from the buying side have said that the 3 cent/lb increase for August was not implemented for all buyers. Demand in
In addition to higher monomer prices, there is currently an “atypical” situation in
Polidesa, the other Mexican EPS producer, recently said it was considering price increases of about 2 cents/lb for September. However, a source close to the company was not available on Tuesday to confirm if any official announcement has been made.
Before any September proposed increases,
Polioles is a joint venture of Alfa and BASF. Polidesa is owned by the Idesa Mexican group.
Besides Polidesa and Polioles, other major North American EPS producers are BASF, Nova Chemicals, Flint Hills Resources, Styrochem and Nexkemia.
The announcement comes after Nova proposed a 3 cent/lb increase in US EPS for both its regular and modified EPS starting in mid-September.
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