In Asia, local PS prices in China and Southeast Asia have moved higher over the past few days in line with rising styrene feedstock costs, as per Chemorbis. In the region's import markets, strong resistance from buyers has prevented PS prices from rising so far, with some sellers offering at the upper end of the import range even agreeing to price reductions of US$20-30/ton to speed up sales. However, with the most recent increases in feedstock styrene prices pushing theoretical GPPS production costs above the prevailing offer levels for GPPS, import sellers are likely to take a firmer stance on their offer levels in the days ahead.
Spot styrene feedstock costs have gained approximately US$65/ton when compared with the end of last week on FOB Korea basis, with players pointing to higher prices for crude oil and benzene as well as firmer equity prices in China following the US Federal Reserve's recent quantitative easing measures as some of the main factors behind the increase in prices. PS sellers in China's domestic PS market responded to the early week jump in styrene feedstock costs by raising their offers by CNY200-300/ton (US$30-45/ton) on the first trading day of the week. Producers and distributors reported that they are seeing better sales at the start of this week as buying interest has picked up in response to expectations that accelerating inflation will push prices higher over the short term. While players are expecting to see further upward movement in prices over the near term, the medium term outlook remains foggy as a number of players remain skeptical as to the medium term feasibility of the current price increases.
Local PS prices in Southeast Asia have also been gaining ground over the past week as sellers have implemented gradual increases on their prices in the face of escalating costs and persistently slow demand. A distributor in Thailand began the week by increasing their GPPS offer to their local market by THB500/ton (US$17/ton), citing higher prices in the Chinese market as justification for their price increases. The distributor predicted that domestic prices would continue to move higher in Thailand over the days ahead in accordance with bullish sentiment inside China. In Malaysia, offers for Southeast Asian HIPS rose by around MYR50/ton (US$16/ton) late last week based on rising production costs, although sellers complained that they are having a difficult time attracting much buying interest at the present. Meanwhile, a converter in Indonesia reported to have received offers for domestic GPPS that were US$20-50/ton higher than the offers they received in the prior week. The converter said that they are limiting their purchases these days as they are not seeing particularly good demand for their end products.