02 January 2014 22:26 [Source: ICIS news]
HOUSTON (ICIS)--US polystyrene (PS) producers have revised January price increases for all grades of PS upwards to 6 cents/lb ($132/tonne, €97/tonne) effective on 1 January, sources said on Thursday.
Styrolution and Americas Styrenics had initially announced separate increases of 3 cents/lb for the month, while Total Petrochemicals had announced an increase of 4 cents/lb.
However, based on rising benzene and styrene prices, producers revised those original announcements, with all three producers now seeking a total of 6 cents/lb for all grades, sources said.
A copy of a 27 December customer letter from Styrolution blamed the revision on “abrupt increases in primary feedstock costs,” while a 26 December letter from Total also blamed “rapidly rising feedstock costs,” according to copies of the letters obtained by ICIS.
A 23 December customer letter from Americas Styrenics said its revision was based on higher expectations for styrene costs in January.
“In the past week, styrene feedstock cost estimates for January have moved up sharply on a rising crude oil market and tight aromatics complex,” the letter states.
In the last few weeks of the year, benzene spot prices spiked, climbing above $5/gal briefly, before moving lower. January benzene contracts settled this week at $4.84/gal, up by 35.5 cents/gal from December levels.
Buyers said they believed the revised nominations were just a reaction from producers to the spiking benzene costs. Now that benzene contracts have settled for less than originally seemed possible, buyers said they did not believe all 6 cents/lb would be implemented.
“My guess is that it is doubtful that the whole 6 cents will stick,” said one buyer, who estimated that it is possible that between 3 and 4.5 cents/lb worth of increases will be implemented during the month.
US December PS prices are assessed by ICIS at 105-108 cents/lb for bulk GPPS DEL (delivered) and 113-115 cents/lb for bulk HIPS DEL.
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