Asia ABS trends up after recent losses on feedstock gains

SINGAPORE (ICIS)–Asia’s acrylonitrile-butadiene-styrene (ABS) market has reversed its losing streak on the back of recent rebound in feedstock prices.

Offers were quoted higher by around $20/tonne for certain brands since last week after spot prices hit lows of $1,300/tonne CFR (cost & freight) NE (northeast) Asia levels in November.

Spot prices had tumbled from above $1,400/tonne CFR NE Asia in October, ICIS data showed.

“Some buyers have stepped out to replenish some stocks ahead of the Lunar New Year,” said a trader in China. The Lunar New Year falls on late January 2020.

The lack of resolution to the US-China trade war despite several rounds of talks dampened market sentiment. Demand for the resins has also ebbed amid the year-end lull.

Players are focusing on the new tariffs deadline on 15 December, on whether the US will delay or push through with its plan to slap tariffs on its remaining $156bn Chinese imports.

The US decision on the issue would have a bearing on the potential signing of a partial trade deal between the two economic giants.

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

While margins of ABS producers remained adequate, suppliers took the opportunity to raise offers in order to maintain profits.

However, some players expect further price upside to be limited as the lull season is expected to last into February next year, after the Lunar New Year holidays.

“Most producers increase prices modestly this week, but higher prices could meet with resistance from buyers,” said a producer in Taiwan.

Focus article by Clive Ong

Photo: Container ships is docked at the Yangshan port in Shanghai, China. (Source: AP/Shutterstock)

Click here to view related stories and content on the US-China trade war topic page