Styrene prices surge on US Gulf plant problems

The market will tighten further with SABIC’s force majeure and AmSty’s extended turnaround in Louisiana, along with INEOS Styrolution’s turnaround in Texas. (Baytownbert/wikimedia.com)

Focus article by David Love

HOUSTON (ICIS)–It is unclear how extended US Gulf styrene outages will impact downstream markets, but prices in all areas likely will be pressured higher as a result of a spike in feedstock prices.

SABIC declared force majeure on Wednesday on the styrene it receives from a joint venture with Total Petrochemicals at the 1.1m tonne/year Cosmar facility in Carville, Louisiana.

SABIC informed customers about an equipment failure that will impact the facility’s capability to produce styrene until sometime this summer, the producer confirmed on Wednesday.

As a result, SABIC advised customers what percentage of styrene orders they could expect to receive until full production has been restored.

Partner Total informed SABIC about the equipment failure, which it said was beyond its reasonable control. Market sources said the problem was with a superheater.

The plant is currently conducting a planned turnaround, which consists of a catalyst change on one line, the addition of a new compressor and work on the distillation tower, market sources said.

The turnaround began in the middle of January, and was supposed to be completed at the end of February, market participants said.

SABIC said that it would continue to monitor repairs at the Cosmar facility, and would keep its customers informed as the plant regains production capabilities. Additionally, the producer said that it would promptly inform customers when it has any updates.

On Tuesday, Americas Styrenics (AmSty) announced in a press release that it was extending a regularly scheduled styrene unit turnaround at its St James facility in Louisiana until mid-March.

Work on the unit, which was to return to service around 3 February, was extended in order to complete repairs on critical equipment, the release said.

AmSty said that it was making necessary repairs based on findings discovered during its maintenance turnaround, which began on 4 January.

As a result, about half of AmSty’s St James production will be offline for the better part of the first quarter, according to the press release.

As a result of the two supply situations, ICIS-assessed styrene spot prices, which stood at an average of 63.83 cents/lb on Friday, surged to an average of 66.20 cents/lb on Wednesday. Some market participants said that prices would soon hit 68 cents/lb as there is no spot material in the market.

The US styrene market will tighten further this month, when INEOS Styrolution begins a planned turnaround at its 450,000 tonne/year plant in Texas City, Texas.

At this time it is unclear how the Gulf outages will impact downstream markets, such as polystyrene (PS), expandable polystyrene (EPS) and acrylonitrile-butadiene-styrene (ABS).

North American styrene producers include Americas Styrenics, INEOS Styrolution, LyondellBasell Chemical, Pemex, Shell Chemicals Canada, Total Petrochemicals and Westlake Styrene.