17 September 2013 22:18 [Source: ICIS news]
US Expandable Polysterene (EPS) producers who planned to raise prices as much as 3 cent/lb to their products both for construction and packaging effective this week have decided to postpone the hike because of competition.
At least two sources from the sell side have said that Nova Chemicals, Flint Hills and BASF will not seek any price increases until the start of next month. All the producers had been said to be seeking higher prices for their EPS and Nova had even sent a letter to customers to alert of a 16 September hike with others also communicating increases or plans to increase prices at around the same time.
One source said the decision by his company to postpone the increase was due to “actions in the market” related to competitive dynamics. Another source from the sell side showed concern that traders with Asian product could come into the market.
Meantime, in the buy side, one source said that if eventually prices do increase in October the rise may be short lived as it is a period where demand from the construction industry normally starts to decline as such activity diminishes particularly in the north of the ?xml:namespace>
However, sellers said demand is very strong currently and that they will not likely be able to meet new, not forecasted orders until late October or even November in one case. Feedstock like benzene and styrene have either been higher or more expensive to get recently, another source said, explaining the need for the increase.
Sellers describe the supply as being “tight”. One source said it received an unusually large number of orders for October despite the price increase plan which shows very good demand.
The price increase comes as Nova Chemicals is planning to shut down its
ICIS is currently assessing spot block or construction grade EPS at 97.00-102.00 cent/lb with the spot package grade of EPS at 95.00-100.00 cent/lb. The assessment considers prices that smaller buyers would normally access for delivered products.
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