North American EPS prices to rise in December

David Love

01-Dec-2015

HOUSTON (ICIS)–A US expandable polystyrene (EPS) producer announced a 3 cents/lb price increase effective 14 December, and an EPS producer in Mexico separately announced a price increase of 3 cents/lb effective 1 January, the producer said on Tuesday.  

It is yet unclear if the other North American producers will announce price increases for December.

The increases were expected, after prices fell by an average of 4 cents/lb in October and rolled over in November.

EPS producers watched benzene closely during the final few weeks of November, as EPS prices typically track benzene closely. December benzene contracts settled just prior to the US Thanksgiving holiday at $2.30/gal, which was up by 13 cents/gal from November.

The general rule of thumb is that EPS prices move by 1 cent/lb for every 10 cents/gal move on benzene prices. With benzene notching smaller gains in October (10 cents/gal) and November (6 cents/gal), EPS prices did not increase at that time. However, with the latest benzene price increase, benzene prices have risen from $2.01/gal in September to $2.30/gal in December giving producers even more incentive to raise EPS prices in December.

The only price increase in the US market this year, excluding the one going into effect in December, was in May, when prices firmed by an average of 3.5 cents/lb for block and packaging. After that rise, prices were flat from May through August.

North American EPS producers include Dart Polymers, Flint Hills Resources, Grupo Idesa, Nexkemia petrochimie, Nova Chemicals, Flasti-Fab, StyroChem International and Styropek.

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