European ABS producers target April price increases

04 April 2014 12:19  [Source: ICIS news]

Price riseLONDON (ICIS)--Producers in the European acrylonitrile-butadiene-styrene (ABS) market have announced increases of up to €35/tonne for April monthly business, though buyers feel some target are too high, sources said on Friday.

Styrolution have targeted a €20/tonne increase over March prices for general purpose ABS, and Styron announced a €35/tonne increase for all grades.

A third producer is targeting increases of €20/tonne for monthly business, and up to €30/tonne for quarterly business because of higher feedstock prices.

Buyers were surprised by the size of the increase of some of the producers' targets, given the €15/tonne increase in the April feedstock styrene contract. The April feedstock butadiene contract settled at a rollover.

“We think [some producers’ targets] are too much. We think there may be an increase, but not a lot,” a distributor said.

“[A fourth producer] on ABS is asking for a €50/tonne increase, which is a lot but [we] did not agree because other producers are [offering]  €20/tonne,” a buyer said.

Buyers also expect some upward movement in April prices, but will try and keep increases to a minimum because of flat demand.

One compounder who had seen good demand in March said April levels were looking unchanged, but this could be due to competition from other extruders within its local market.

A producer said increases in April were likely based on strong demand levels seen in the first quarter, which other producers expect to carry on into the second quarter.

“Since demand was quite good in March, and April seems to continue for that level, so we [are] go[ing] for a little bit more [than the feedstock increase],” a producer said.

However, a second producer warned that the Easter holidays in mid-April, together with public holidays at the beginning of May, could keep demand levels flat, at least for the first half of the second quarter.

“March was strong. April and May, demand could decrease a little bit based on holidays in Europe,” the second producer said.

Asian suppliers will also add pressure to some producers, with competitively priced ABS still available to European buyers at a rollover from March, sources said.

By: Matt Tudball
+44 208 652 3214

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