Styrene monomer prices nosedived $40/mt or 2.4% Monday to $1,594.50/mt FOB Korea and $1,621.50/mt CFR China, compared to last Friday, as the Chinese market returned from the Lunar New Year holidays amid a build-up in inventory levels and the expectation of slow demand from downstream industries in February, market sources said.
Monday's prices are the lowest in roughly three months. They were last assessed lower on November 11 at $1,594/mt FOB Korea and $1,620/mt CFR China.
In Monday's market several deals were heard done for March and April loading 2,000 mt cargoes of Asian origin, excluding Middle East and Taiwan origin -- the standard terms for spot cargoes in the Asian market -- at a price range of $1,630-1,645/mt CFR China for March and $1,643-1,655/mt CFR China for April.
The domestic price of SM in the east of China also fell compared to last Friday by Yuan 425/mt to around Yuan 11,100-11,200/mt on Monday, roughly $1,530/mt on an import parity basis.
A Chinese trader said that besides the increasing inventory level, other factors that were dragging prices down were "low real demand and tight cash flow."
Meanwhile, various estimates last week pegged the inventory held by traders in East China at 100,000-140,000 mt, and total inventory held by both traders and end-users at around 250,000 mt.
The last time commercial stock levels in East China were heard above 140,000 mt was in February 2012, when they stood at around 142,000 mt in the last week of the month, Platts data shows.
Inventory was estimated at around 93,000 mt before the Lunar New Year holidays.
