Asian styrene monomer price increased $35/mt from a week
ago, to be assessed at $1,309/mt CFR China Monday (as on 17-01-2017). SM CFR
China marker hit an 18-month high on Wednesday, as demand persisted. The last
time the marker was assessed any higher was July 3, 2015, when it was assessed
at $1,306.50/mt CFR China. In China, domestic prices for prompt cargoes surged
Yuan 370/mt week on week and was at Yuan 10,520/mt Monday.
This is equivalent to $1,267/mt on import parity basis. There was market talk of some delays in deepsea cargoes from the US. Meanwhile, turnarounds in Northeast Asia during the first quarter remained a key supportive factor for the SM market. In plant news, South Korea's Lotte Chemical will be shutting its 580,000 mt/year SM plant at Daesan in May, a company source said Tuesday.
The SM plant will be offline for maintenance for a month, from the middle of May to June, the source said. Taiwan Styrene Monomer Co. will shut both its 180,000 mt/year No. 1 SM plant and 160,000 mt/year No. 2 SM plant in H2 February, a company source said Tuesday.
The plants, at Lin Yuan, will be shut down for maintenance for three weeks, the source said. Overall, trading activity for prompt months remained thin this week, according to some sources, as most buyers are well covered until February. However, firm demand, especially for March cargoes, persisted and was seen throughout the week. Meanwhile, East China inventory levels remained tight and was estimated at 45,700 mt Wednesday, although it was up 4,200 mt from Wednesday last week. Upstream, feedstock benzene costs rose higher.
The FOB Korea marker increased $31.50/mt week on week to $918.50/mt Monday, while the CFR China marker also rose $43/mt during the same period to $923/mt Monday. The FOB Korea benzene marker hit a 25-month high Tuesday due to firm prompt Chinese demand and tight spot supply. High prices could ease due to a closed arbitrage to the US Gulf Coast from the East and quiet demand for Chinese end-users who are currently well-covered. Downstream, Asian acrylonitrile-butadiene-styrene was assessed at $$1,830/mt CFR China Wednesday, up $30/mt from Wednesday last week. The ABS market remained well supported, as butadiene prices soared $300/mt week on week to a nine month high Monday at $2,950/mt CFR China, due to tight supply.
RATIONALE: Asian SM was up $35/mt week on week but unchanged from Friday at $1,309/mt CFR China amid thin discussions for February-loading cargoes. Currently, the markers take the average of the H1 and H2 February laycans. There was no bid or offer heard for February Friday. Hence, H1 and H2 February were both assessed at $1,309/mt CFR China. The FOB Korea marker was assessed $37/mt higher week on week, and flat day on day, at $1,284/mt Monday. CFR India was assessed up $32/mt to $1,315/mt Monday, in line with a tradable indication heard at $1,315/mt CFR India.
This is equivalent to $1,267/mt on import parity basis. There was market talk of some delays in deepsea cargoes from the US. Meanwhile, turnarounds in Northeast Asia during the first quarter remained a key supportive factor for the SM market. In plant news, South Korea's Lotte Chemical will be shutting its 580,000 mt/year SM plant at Daesan in May, a company source said Tuesday.
The SM plant will be offline for maintenance for a month, from the middle of May to June, the source said. Taiwan Styrene Monomer Co. will shut both its 180,000 mt/year No. 1 SM plant and 160,000 mt/year No. 2 SM plant in H2 February, a company source said Tuesday.
The plants, at Lin Yuan, will be shut down for maintenance for three weeks, the source said. Overall, trading activity for prompt months remained thin this week, according to some sources, as most buyers are well covered until February. However, firm demand, especially for March cargoes, persisted and was seen throughout the week. Meanwhile, East China inventory levels remained tight and was estimated at 45,700 mt Wednesday, although it was up 4,200 mt from Wednesday last week. Upstream, feedstock benzene costs rose higher.
The FOB Korea marker increased $31.50/mt week on week to $918.50/mt Monday, while the CFR China marker also rose $43/mt during the same period to $923/mt Monday. The FOB Korea benzene marker hit a 25-month high Tuesday due to firm prompt Chinese demand and tight spot supply. High prices could ease due to a closed arbitrage to the US Gulf Coast from the East and quiet demand for Chinese end-users who are currently well-covered. Downstream, Asian acrylonitrile-butadiene-styrene was assessed at $$1,830/mt CFR China Wednesday, up $30/mt from Wednesday last week. The ABS market remained well supported, as butadiene prices soared $300/mt week on week to a nine month high Monday at $2,950/mt CFR China, due to tight supply.
RATIONALE: Asian SM was up $35/mt week on week but unchanged from Friday at $1,309/mt CFR China amid thin discussions for February-loading cargoes. Currently, the markers take the average of the H1 and H2 February laycans. There was no bid or offer heard for February Friday. Hence, H1 and H2 February were both assessed at $1,309/mt CFR China. The FOB Korea marker was assessed $37/mt higher week on week, and flat day on day, at $1,284/mt Monday. CFR India was assessed up $32/mt to $1,315/mt Monday, in line with a tradable indication heard at $1,315/mt CFR India.
European styrene spot
price assessed up
The European styrene spot price was assessed at $1,269.50/mt FOB ARA Monday, down $15.50/mt on the day, and up $33.50/mt on the week. The price reached a fresh 17-month high on January 11 at $1,289.50/mt, then declined in the latter part of the week. A source said Monday that the price increase at the beginning of the week was supported by firm demand in Asia. However, buy interest in Asia was seen easing on Friday and Monday and the market was calmer. The market is "a little bit bearish," a second source said Monday. Although prices have declined, prices remain at high levels due to tightness in the US and Asia markets. As a result, sources expect Europe to become a key supply region in the coming weeks and for the arbitrage to Asia to open. The second source added that "a lot of exports" can be expected if European prices come off. On Monday, two 1,000 mt trades were reported at $1,270/mt for January and two 1,000 mt February trades at $1,280/mt. In terms of supply in January, there have been no reports of plant issues in Europe. However, in February, Trinseo's 500,000 mt/year Dutch Terneuzen unit is expected to go on turnaround for 3-4 weeks. This was reflected in the $15/mt contango in the market. Lower production of styrene also contributed to the backwardation in the feedstock benzene market.
RATIONALE: S&P Global assessed styrene for delivery 5-30 days forward at $1,269.50/mt FOB ARA Monday, down $15.50/mt on the day but up $33.50/mt on the week. January was assessed at $1,265/mt, down $15/mt, and $5/mt below the outstanding offer at $1,270/mt. It was assessed $5/mt below the traded level heard at $1,270/mt as an offer following the trade disproved the traded level. February was assessed at $1,280/mt, down $20/mt, and at the traded level. It was assessed between the outstanding bid-offer range heard at $1,275- 1,290/mt.
The European styrene spot price was assessed at $1,269.50/mt FOB ARA Monday, down $15.50/mt on the day, and up $33.50/mt on the week. The price reached a fresh 17-month high on January 11 at $1,289.50/mt, then declined in the latter part of the week. A source said Monday that the price increase at the beginning of the week was supported by firm demand in Asia. However, buy interest in Asia was seen easing on Friday and Monday and the market was calmer. The market is "a little bit bearish," a second source said Monday. Although prices have declined, prices remain at high levels due to tightness in the US and Asia markets. As a result, sources expect Europe to become a key supply region in the coming weeks and for the arbitrage to Asia to open. The second source added that "a lot of exports" can be expected if European prices come off. On Monday, two 1,000 mt trades were reported at $1,270/mt for January and two 1,000 mt February trades at $1,280/mt. In terms of supply in January, there have been no reports of plant issues in Europe. However, in February, Trinseo's 500,000 mt/year Dutch Terneuzen unit is expected to go on turnaround for 3-4 weeks. This was reflected in the $15/mt contango in the market. Lower production of styrene also contributed to the backwardation in the feedstock benzene market.
RATIONALE: S&P Global assessed styrene for delivery 5-30 days forward at $1,269.50/mt FOB ARA Monday, down $15.50/mt on the day but up $33.50/mt on the week. January was assessed at $1,265/mt, down $15/mt, and $5/mt below the outstanding offer at $1,270/mt. It was assessed $5/mt below the traded level heard at $1,270/mt as an offer following the trade disproved the traded level. February was assessed at $1,280/mt, down $20/mt, and at the traded level. It was assessed between the outstanding bid-offer range heard at $1,275- 1,290/mt.
