ABS Prices in China,Italy and Turkey Are Facing Significant Upward Pressure

ABS prices in China, Italy and Turkey are facing significant upward pressure due to rapidly escalating upstream costs, as per ChemOrbis. Although demand in all three countries has been unspectacular, players are nevertheless predicting increases in the days ahead following the significant recent hikes in upstream costs. In China, ABS prices posted increases in the first full week after the Chinese New Year holidays and players are predicting further price hikes in the days ahead. Prices at the lower end of the ranges are expected to slowly fade from the market over the coming week as traders and distributors will need to raise their prices after selling off the last of their previously purchased stocks. Several overseas producers reported that they have withdrawn their offers as they need to recalculate their breakeven levels following the massive run-up in spot butadiene prices since the end of the holidays. Theoretical cost calculations based on the prevailing spot prices for styrene, butadiene and ACN surged by more than US$100/ton in the first week after the holidays, owing primarily to a massive upward swing in spot butadiene prices. “We lifted our prices after the holidays in accordance with strong upward movements in feedstock costs. Our new prices have not met with much buying interest yet as many converters are taking extended holidays but we are planning to maintain a firm stance on our prices for now, ” commented a source at a Korean producer. “Prices will definitely move higher over the short term following the significant jump in upstream costs. However, we are not planning to purchase large amounts of material from the import market as we expect to encounter resistance from buyers, ” stated a distributor. Players in Italy are also bracing for higher ABS prices after the February contracts for styrene, butadiene and benzene all settled with triple digit increases from January, with the largest increases occurring in butadiene costs much as in Asia. “We believe that ABS prices will witness three digit increases in February in accordance with the sharp upward movements in upstream costs, as per ChemOrbis. However, we are not expecting to see particularly good demand this month, ” commented a distributor in Italy. “We managed to conclude some deals for February even though demand has been quite sluggish at the start of the month, ” another distributor reported. “Our customers were not happy about paying higher prices for this month, ” the distributor added. In Turkey, higher upstream costs also supported bullish expectations in the ABS market in spite of lackluster demand for the product. “We are waiting to receive new prices from our Asian suppliers, which we believe will be announced with increases given the strong upward movement in butadiene prices, ” a trader reported. “We are not offering any material to the market for now as we do not have any cargoes in stock. We are still waiting to receive new import prices and feel confident that new import offers will move higher, ” another trader commented. “We are offering locally-held materials for prompt shipment at higher prices at the start of this week and are considering announcing additional price hikes in the days ahead, ” a distributor stated. Source: plastemart.com