US February EPS increase unlikely on feedstock direction

Source: ICIS News

2018/01/09

HOUSTON (ICIS)--After the January price rollover in the US expandable polystyrene (EPS) market, the drop in key feedstock prices has made a February price increase very unlikely.

Prices for feedstocks benzene and styrene are equally important in providing direction for EPS prices.

Benzene prices began to drop just before the holidays and have increased only slightly since that time.

ICIS benzene spot prices averaged $3.34/gal during the first 20 days of December, but prices dropped to $3.09/gal on 21 and 22 December.

ICIS benzene spot prices averaged $3.14/gal during the first eight days of the month, after January benzene contracts settled at an average of $3.22/gal.

ICIS styrene spot on 22 December stood at 59.23 cents/lb. That price on 5 January had dropped to 56.92 cents/lb.

Buyers this week said that they have heard nothing about a February increase at this point.

January EPS demand is seen as good for this time of year. The expectation of higher prices in February would likely have pushed buyers into the market to pre-buy material before the price increase went into effect. However, barring something unforeseen in the feedstocks market, that scenario is not likely.

EPS prices in 2017 jumped by 24 cents/lb in the first quarter amid surging styrene prices due to tight supply. EPS prices hit the high for the year in March. Overall, ICIS 2017 block prices rose by 9.0 cents/lb, and packaging prices rose by 7.5 cents/lb.

Tuesday ICIS EPS prices are 88-96 cents/lb for block and packaging grades, DEL (delivered) US.

North American EPS producers include Dart Polymers, Flint Hills Resources, Grupo Idesa, Nexkemia Petrochimie, NOVA Chemicals, Plasti-Fab, StyroChem International and Styropek.

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