Asian Styrene Prices to be Weighed Under Chinese Supply Glut in 2021

Asian Styrene Prices to be Weighed Under Chinese Supply Glut in 2021

  • 15-Dec-2020 11:00 AM
  • Journalist: Francis Stokes

Strenuous capacity additions by China are expected to lengthen the Asian Styrene market by around 6.88 MMTPA in 2021 and trigger a supply glut situation despite lingering demand patterns and already dull dynamics, our latest market estimates suggest. Among new capacities scheduled on cards, Zhejiang Petrochemical's 1.2 MMTPA capacity, Wanhua Petrochemical's 650 KTPA plant and CNOOC Shell's 650 KTPA unit are the major ones.

However, production cuts due to scheduled maintenance turnarounds in H1 2021 are expected to partially offset the product oversupply and lend a strong support to the Chinese Styrene Monomer (SM) spreads, consequently narrowing the gap between CFR and domestic Styrene pricing and ensuring reduced import volumes. China's buoyant demand from home appliances and automobiles sector is likely to serve well the Styrene monomer market in the near term. It is being anticipated that India, which has reported substantial recovery in demand for downstream Polystyrene and Acrylonitrile-Butadiene-Styrene in the Oct-Dec quarter, is likely to come out of the prevailing supply shortage by mid-January.

However, fears that the Indian government’s stress over compliance to certain specifications set by the Bureau of Indian Standards (BIS) over imported Styrene imports may give rise to some regulatory issues in mid-2021. South Korea's Styrene supply has been dented since March 2020 after an unscheduled plant outage at one of its upstream crackers. It is being estimated that once Styrene supply returns to normalcy in the country, deep sea US cargoes bound for Asia would be specifically directed towards India, which stands as the region's second largest Styrene importer.

As per ChemAnalyst, Styrene prices have eased to around USD 900 per tonne CFR China from USD 1180 per tonne levels observed in November while CFR India prices have been settled around USD 820 per tonne in December.

Related News

Global ABS Market Struggles with Demand Headwinds in November 2023
  • 23-Nov-2023 4:19 PM
  • Journalist: Robert Hume
INEOS Styrolution and Sinopec Unveil ABS Facility in Ningbo, China
  • 22-Nov-2023 10:59 AM
  • Journalist: Shiba Teramoto
ELIX to Halt ABS Production in Spain for Repairs in December
  • 14-Nov-2023 5:31 PM
  • Journalist: Harold Finch
ABS Price Trend Concludes October 2023 on a Bearish Note Globally
  • 31-Oct-2023 12:56 PM
  • Journalist: S. Jayavikraman