US styrene spot prices jump on extended outage

Focus story by David Love

HOUSTON (ICIS)–US styrene spot prices rose mid-week before jumping higher on Friday after Americas Styrenics (AmSty) announced on Thursday that it expects its current US Gulf styrene outage to extend into the second quarter, sources said on Friday.

AmSty expects a styrene outage at its 950,000 tonne/year Saint James plant in Louisiana to extend into the second quarter to complete repairs on critical equipment, the company said in a news release on Thursday.

AmSty said that it is working to bring full styrene production back on line as safely and quickly as possible. The producer added that the outage affects about half of its styrene production.

The outage is contained to one of AmSty’s two Saint James styrene units. The capacity of the plants are 500,000 tonnes/year and 450,000 tonnes/year. It is unclear which of the two plants is down.

AmSty is currently working with its styrene customers to assure adequate supply, the company said.

On 30 January, AmSty announced in a news release that it was extending a regularly scheduled styrene unit turnaround at the facility in Louisiana until mid-March.

A second scheduled turnaround that began in the middle of January later resulted in a force majeure being declared.

SABIC declared force majeure on 31 January 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 would impact the facility’s capability to produce styrene until sometime this summer, the producer confirmed on 31 January.

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 result of the two extended outages has seen styrene spot prices jump higher this month. US Gulf spot prices have become the highest prices globally, and are attracting attention from Asian and European sellers.

Two cargoes from South Korea were fixed to the US Gulf/Houston this week totalling 11,000 tonnes, and 4,000 tonnes was fixed last week from Rotterdam to Houston.

No spot material is being exported from the US Gulf at this time because of high domestic prices. Producers and traders will not sell FOB cargoes at lower prices than they can sell domestic material for, one market participant said.

On Thursday, a producer sold a domestic barge at 80.50 cents/lb, which was up sharply from a similar deal done two days earlier at 77.10 cents/lb. Bids at the beginning of the week stood at 74.80 cents/lb.

The already-tight styrene spot market is bracing for the third planned turnaround of the first quarter. INEOS Styrolution is scheduled to take its 450,000 tonne/year Texas City styrene plant in Texas down at the end of February. The plant is expected to be down about six weeks, market sources said.

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