Asia ABS market quiet amid US-China trade tensions

Author: Clive Ong

2019/10/24

SINGAPORE (ICIS)--Activity in Asia’s acrylonitrile-butadiene-styrene (ABS) market remained slow with players in a cautious mode as the US-China trade war continued to weigh on sentiment.

Qingdao port in Shandong province, China (Photo by Sipa Asia/Shutterstock)

ABS trade in China has remained muted after its week-long National Day holidays in early October, with users and traders mostly keeping lean resin stocks.

Spot activity tapered off on slack demand, while the thin trade has resulted in relatively stable prices.

Spot prices were at $1,370-1,450/tonne CFR (cost & freight) China, depending on parcel size and origin.

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ABS is the largest volume engineering thermoplastic resin and is used in automobiles, electronics, appliances and recreational products.

While a partial deal between the US and China appear to be imminent, the lack of details has kept ABS market players on their toes.

“A trade deal seems unlikely with the trade war likely to drag on,” said a trader in China.

With the market now in the traditionally slower fourth quarter, most sellers expect limited improvement in demand in the near term.

“The market will move along with feedstock costs as demand is relatively soft,” said a producer in Taiwan.

Feedstock costs have been declining in recent weeks, with most ABS purchases being done on a need-to basis and buyers opting for smaller parcels over large lots.

While sellers were not keen to reduce offers sharply as production margins remained thin, most makers have reduced prices in small quantum in recent weeks to stoke buying interest.

Focus article by Clive Ong

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