Styrene and ethylene prices firming up in Asia

01-Jul-14

In Asia, styrene and ethylene prices have been firming up, while the increases on monomer prices are attributed to firmer production costs as well as tight supplies, especially for ethylene,as per ChemOrbis. Spot styrene prices gained on the back of bullish benzene costs. Spot prices were US$45/ton firmer on the week on FOB Korea basis, and up US$20/ton on a CFR China basis. Benzene prices, which gained US$45-50/ton over the same period due to firm oil and naphtha prices, played a role in these hikes in the styrene market. Spot naphtha closed last week at mostly steady levels, but prices were US $35-40/ton firmer on a month over month basis. In the ethylene market, spot prices moved up by $25/ton in Northeast Asia and escalated by $40/ton in Southeast Asia. Supplies were reported to be tighter in the region, especially for cargoes coming from Japan and South Korea, with players commenting that supply tightness prompted the recent hikes. According to ChemOrbis, in downstream markets, China’s PE market remained firm on the back of strong ethylene and naphtha costs. Players mostly anticipate further increases on July prices since high upstream costs have pushed some producers to cut down their operating rates in order to cope with rising costs. A similar scenario exists in the PS market. Although overall PS demand is not that strong, prices continue to be supported by higher styrene and benzene costs.