Major global styrene markets witnessed substantial increases over the week triggered mainly by constantly rising benzene costs around the world, as per the pricing service of ChemOrbis. Slightly firmer energy prices on the week and persistently soaring ethylene prices in regions including Asia and the US contributed to the trend.
In Europe, spot benzene prices surged around $70/ton on FOB NWE basis during the past week bringing the total increase to nearly $90/ton with respect to early December. Relentless increases in benzene costs exerted an upwards pressure on spot styrene and pushed the market up by $55/ton with the same terms on the week. The recent values represented an increase of the same amount from early this month. Plus, an arbitrage window was opened to Asia which helped styrene costs to firm up.
In Asia, spot styrene prices added to their previous gains on the strength of increasing feedstock costs. Spot benzene prices gained around $20/ton on FOB South Korea basis week over week. Although prices edged down by around $5/ton early this week, they still indicated a $55/ton increase when compared to the beginning of the month. In addition, spot ethylene prices continued to move up over the last week, with a $40/ton weekly increase on CFR Northeast Asia basis while they represented a cumulative spike of $140/ton so far in December.
Some traders in Asia reportedly commented that styrene prices may cool off as the new year begins considering the poor performance of downstream markets. In the meantime, delayed shipments stemming from severe weather conditions in the region were said to have kept the availability tight, according to traders. The region is already set for several maintenance shutdowns during the December-February period, while high feedstock costs caused some producers to reduce their production rates recently.
In the US, accelerating ethylene and benzene prices drove spot styrene significantly higher with offers reaching a high which had been last seen in 2008, according to market players. Spot benzene prices in the country jumped 13 cents/gal ($39/ton) on FOB USG basis week over week bringing the total increase to 29 cents/gal ($87/ton) since December started. Looking at spot ethylene offers on FD USG basis, they gained 1.25 cents/lb ($28/ton) on the week and 3.25 cents/lb ($72/ton) since early this month.
As a consequence of soaring feedstock prices and limited availability owing to unexpected shutdown news from Styrolution’s side, the spot styrene market moved up 2 cents/lb ($44/ton) from the previous week, as per ChemOrbis. Now, the recent spot styrene offers indicate a 2.9 cents/lb ($64/ton) increase on FOB USG basis from earlier this month. Styrolution experienced a small fire at its Texas styrene plant which forced the company to shut the 450,000 tons/year plant down. The company is reportedly expected to resume operations in January after repairs at the facility are completed.
