US spot benzene market values could be facing a sharp decline during the first quarter due to a combination of upcoming derivative styrene turnarounds and shipments from Asia, market sources said Wednesday.
The US benzene market saw a similar situation during the first quarter of 2013 when prices were pressured lower by styrene producer turnarounds. according to market participants.
Several styrene producers are performing maintenance during the first quarter, market sources said. Similar to what occurred during the first quarter of 2013, normal consumers of benzene might become sellers during their turnarounds, weakening demand and lengthening market supply.
In addition to the upcoming turnarounds, Cosmar, a joint venture between Total and Sabic, took a styrene unit at its Carville, Louisiana, facility down for unplanned maintenance on Monday, sources said, adding that it will be down for two to three weeks.
Supply tightness could also be eased amid benzene shipments from Asia arriving during the second half of February, sources said, adding that arbitrage opportunities are currently attractive.
Currently, higher US spot benzene pricing has been supported by limited supply availability, sources said.
US spot benzene was last assessed Tuesday at $4.93/gal FOB US Gulf Coast for January. Bids and offers for January were absent Wednesday morning.
