Slow demand pulls down ABS prices in China, Italy

ABS markets started November on a softer note in China and in Italy, weighed down by sluggish demand and the softer upstream markets, as per ChemOrbis. Crude oil futures on the Nymex broke below the US$95/barrel threshold for the first time since June in November due to rising crude stockpiles in the US and a stronger dollar. Crude prices slipped 3.3% this past week and they declined by 5.8% during October. In China, ABS prices moved lower both in the import and local markets this week in line with producers’ price cuts and lower spot styrene prices which slipped around US$10/ton on the week while spot butadiene and ACN prices tracked a largely steady trend. A domestic producer lowered their local ABS prices by CNY100/ton this week. A producer source commented, “Our sales performance is still not satisfactory after price cuts. We can only manage to conclude deals if we concede to larger reductions. We expect the market to remain on a soft note given cautious buying activities among buyers.” A South Korean producer lowered their export ABS prices to China by US$10/ton on the week. A source from the producer reported, “We think that we can manage to conclude some deals at our new levels. We are planning to take a wait-and-see attitude before issuing further reductions on our prices.” Another South Korean producer issued relatively larger discounts of US$20/ton on their export ABS prices, pointing to lower styrene costs and stagnant demand. A producer source said, “We are facing difficulty in concluding deals even after our latest price cuts. Most buyers are staying sidelined due to their anticipations of seeing lower prices in the upcoming days.” In Italy, initial November ABS prices emerged with decreases of €20-40/ton from October following the monomer settlements. The November styrene contracts settled down €85/ton from last month on an FOB NWE basis at the beginning of the week although the butadiene contracts settled up €75/ton from October on an FD NWE basis last week. According to ChemOrbis, a distributor reported receiving November offers from his regular West European suppliers with decreases of €30-40/ton from October. He added, “We did not accept these levels as we still have some locally-held non-European cargoes to sell and we started giving November offers with rollovers from our latest October deals as our prices are already competitive.” In the import market, a converter reported buying Far East Asian ABS with decreases of €20/ton from October, commenting, “We expected to see stronger decreases for November considering discouraging demand.”