Low inventories prop up NWE styrene, bearish outlook remains

23-Sep-15
NWE styrene monomer spot demand is seeing an uptick as the low inventories held by consumers in H1-September is causing buyers to venture into the spot market this week, industry sources said in Platts. "If you have low stocks and you need volumes before October, current ranges can give you a good deal -- it makes sense to take molecules now if you're bridging because of where spot is," a trader source said. The same source felt the styrene market has reached the bottom this week after several weeks of slumping prices, which was causing buyers to step into the spot market to take advantage of the steep spot discounts to contract prices. Styrene spot barges were assessed at $928/mt FOB ARA Monday, up US$37/mt or 4% day-on-day. This puts the spot market at a US$415/mt or 31% discount to the gross September contract price of Eur1,200/mt (US$1343/mt). The spot discount at the beginning of the month was 16%. However, this was unlikely to impact the bearish outlook for October styrene prices as market participants expect a triple-digit decrease in the styrene contract price for October. This was attributed to good supply availability, low spot prices and reduced premiums over feedstock benzene. The combination of US imports and the return of Trinseo's 300,000 mt/year styrene unit in Bohlen, Germany, at the end of the month from a scheduled maintenance has caused an ample supply outlook. Trade sources estimated 35,000 mt of US imports have been fixed into the Amsterdam-Rotterdam-Antwerp area and the Mediterranean this month with a similar amount expected to be imported into Europe for October. This caused a downward trend in styrene barge values, shedding 18% since the beginning of the month. Current prices put the styrene premium at US$371.50/mt over feedstock benzene which was assessed at US$556.50/mt CIF ARA Monday. This is 30% lower than the premium at the beginning of the month.
  More News  Post Your Comment
{{comment.Name}} made a post.
{{comment.DateTimeStampDisplay}}

{{comment.Comments}}

COMMENTS

0

There are no comments to display. Be the first one to comment!

*

Name Required.

*

Email Id Required.

Email Id Not Valid.

*

Mobile Required.

Email ID and Mobile Number are kept private and will not be shown publicly.
*

Message Required.

Click to Change image  Refresh Captcha