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European PS sellers obtain styrene hike in April

  • 15/04/2016 (17:53)
PS players in European markets report that increases of up to €100/ton are passing on April deals this week. Indeed, initial hike targets were voiced with up to €120/ton hikes from some producers exceeding the hike on styrene contract settlements. These increases that have materialized for the second month in a row were buoyed by supply constraints and generally healthy demand.

Manufacturers across the region confirm paying three digit hikes while they lament that they can hardly reflect surging PS prices to their end users. A few buyers express their plans to turn to imports in case they can provide a competitive option. Sellers admit seeing less demand compared to March when some buyers purchased considerable amounts to avoid additional price hikes in April.

In Italy, transactions are concluded with monthly increases of €80-100/ton for GPPS and €100/ton for HIPS. A distributor of a West European PS producer said, “Demand is not so high but it is stable compared to the same period of last year.” A container manufacturer in the country hopes the rising trend will lose steam next month. “It is hard to reflect soaring PS raw material costs to our end product prices. However, PS supply is still tight,” the buyer admitted.

An agent of a Central European PS producer reported, “We applied €100/ton hikes to the Italian market, while April demand from our customers is below our expectations. Some import cargos that were purchased a couple of months ago are entering the market and hindering buying appetite.”

A converter expects to wrap up his April business with €80-100/ton increases considering higher styrene costs and high season for PS. The buyer projects a firm outlook for the near term given good demand, reminding PS prices remain below the levels of the same period last year. A packager, meanwhile, plans to close his purchases €90-100/ton above March. “Producers have low stock levels and claim that demand is doing fine. On the other hand, our end product demand is not bright and we are destocking this month,” he noted.

In Germany, distributors obtained €100/ton hikes on their deals this week, attributing the bullish trend to low stock levels on the part of suppliers as well as stable to healthy demand. “We expect to see small increases in May,” one of them voiced. A local seller in the Netherlands also reported that his three digit increase requests were accepted by converters. “Demand has been healthy while our West European supplier may close its order book amidst tightness,” he added.

Looking upstream, spot benzene prices were up by around $25/ton on CIF NWE basis since the beginning of April. Spot styrene costs on a FOB NWE basis did not change much in the same period.
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