Asian PS, ABS markets remain weak on rising trade tensions
Demand concerns gain prominence amid trade war
Weak demand has become the main concern of Asian players operating in styrenics markets across the region since early May. This was when the trade tensions re-escalated after several months of negotiations between Chinese and US officials.
Renewed trade tensions resulted in a new round of bilateral tariffs between China and the US by mid-May.
Chinaplas 2019 also hinders market activity
The overall market activity has also slowed further down this week due to Chinaplas 2019 taking place on May 21-24. Players mostly prefer to adopt a wait and see stance until the end of the event as they aim to see a clearer picture of the market afterwards.
Far East Asian suppliers cut import PS, ABS offers visibly
Several Far East Asian producers have applied further decreases of up to $30/ton on ABS and $50/ton on PS offers to China and Southeast Asia this week, citing thin buying interest as the main reason behind their lower offers.
“Demand for styrenics products is weak as the renewed trade tensions have dampened the sentiment. There is also lack of support from spot styrene prices, which have been following a mostly decreasing trend recently. Considering all these factors, we think that the PS and ABS markets in Asia are likely to remain weak in the near term,” a few traders opined.
China’s local PS market dips to more-than-two-year lows
Local PS prices in China have also been tracking import prices lower for the past couple of weeks. According to the weekly average data obtained from ChemOrbis Price Index, local GPPS prices in China have currently hit a two-year low while local HIPS prices have reached their lowest levels since November 2016.
Styrene under downward pressure, ACN maintains firming
According to ChemOrbis Price Wizard, the weekly average of FOB Korea based spot styrene prices retreated by almost 5% within the past two weeks in response to pressure from rising trade tensions, although it has pared some of its losses recently.
As for ACN, prices on CFR China basis have maintained their firming this week on the back of global supply tightness. Yet, ABS prices have remained unresponsive to higher spot ACN prices so far.
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