Are Polystyrene markets in Asia and Europe set to change?

Global PS markets have shown weak performance with prices following a downward trend amid lower upstream costs and thin buying interest, as per ChemOrbis. However, the past week showed styrene costs regaining some lost ground following bullish benzene prices both in Asia and Europe. Asian styrene costs, although still ten dollars/ton lower than levels reported at the beginning of September, arrested their decreasing trend and recorded week on week increases of US$20/ton both on FOB South Korea and CFR China basis. Styrene prices saw support from firmer benzene feedstock prices, which gained US$15/ton week on week, as well as from dwindling domestic styrene stocks inside China. A Chinese distributor, pointing to the firmer spot styrene markets, commented, “We see some improvement on local PS demand since buyers are now a bit worried that the recovery on styrene costs might push up the PS offers over the near term. Meanwhile, locally held styrene supplies do not seem as loose as before. They are mostly in line with the current demand.” A trader remarked, “Overall PS demand has improved a bit as some buyers started to place some orders given firmer PS prices, pushed up by styrene costs. Yet, we are not sure if this firming trend will be long lived or not since demand will be slowing down in line with the approaching National Day holiday at the beginning of October.” In Southeast Asia, producers were generally firm regarding their offer levels on the back of the firmer styrene costs. This firmness was mostly about keeping the current levels rather than implementing increases. However, players in the region highlighted that some regional producers were still open to negotiations as they worry about the upcoming National Day holiday, which depresses the demand outlook in the region. In Egypt’s import market, traders offering Asian PS cargoes also started to voice somewhat more hopeful views on their market expectations. “Players were mostly sidelined from the market during this past week. However, we anticipate some sort of rebound as of next week in line with firmer styrene prices,” a trader cited. Another trader offering Southeast Asian GPPS in Egypt aid that they issued US$30/ton increases on their offer levels at the last working day of the week for Vietnamese cargoes. However, the trader also highlighted they are still open to negotiations as Egypt will be celebrating the Eid Holiday at the beginning of October. Coming to Europe, the styrene market tracked a similar firmer trend as in Asia. Spot prices are still below early September levels, but on a week over week basis they indicate US$30/ton increases on FOB NWE basis as of the end of last week. The styrene market was pulled up by firmer benzene costs which gained US$50/ton on CIF NWE basis during the same time due to supply issues. Meanwhile, some players highlighted that the lower styrene prices had generated better interest in the spot market and caused more buyers to purchase spot cargoes. A distributor located in France, had issued discounts of up to around €30-50/ton on his September PS deals. According to him, overall PS demand is still sluggish although it indicates slight improvements when compared to the month of August. “For October, we expect PS prices to remain stable or post slight changes depending on monomer costs,” he further added. According to ChemOrbis, a converter in France noted achieving HIPS deals with up to €60/ton decreases in September. “Our supplier advised us to build some stocks as he claims that there will be increases in October,” he further added.