Bullish Naphtha and crude market surged the prices of Styrene in Asia

Strong market sentiments and product unavailability surged the prices of Styrene in Asia. In India, the price of Styrene was observed to be $1476/ton Spot Ex-Vadodara and $1450/ton Spot Ex-Kandla with a week-on-week inclination of 1.79% and 1.90% respectively. In China, the price of Styrene surged to $1370/ton CFR Shanghai and $1480/ton Ex-Tianjin.

With surging Naphtha prices and tight supply, the feedstock Benzene and Ethylene market also surged. The price of feedstock Benzene towards the end of the previous week fell due to crude price reversal and was observed to be $1215/ton but overall, the market remained on the higher end. Ethylene also witnessed a sharp hike and surged to $1370/ton CFR NEA on March 10. With the sharp climbs in Naphtha, Ethylene and Benzene feedstock costs, provincial makers in Taiwan and South Korea are re-considering cutting production rates at crackers and styrene plants. It was also heard that Taiwan's Formosa Petrochemical Corporation (FPCC) plans to decrease the working paces of its three-naphtha steam cracker situated at Mailiao to 85% in March from the previous 90-95% in February. In the previous week, Styrene future traded higher from 07-Mar to 09-Mar, tracking Naphtha and crude to higher end. However, futures fell on 10-Mar due to an increase in the supply of crude oil supported by UAE’s market. The downstream Polystyrene market also surged with accelerating demand from Packaging and Plastic industries.

According to ChemAnalyst, “the price of Styrene in Asia will increase with surging demand and tight supply in the regional market. The demand for Styrene will grow in the coming weeks owing to increased demand from the rubber and automobile industries. Crude oil and Natural Gas prices will surge in Asia which will create a supply-demand gap and supply scarcity will pressurize the major producers to meet the requirement from end users. Strong energy values coupled with improved regional demand trend will increase the Styrene derivative market including Polystyrene, Acrylonitrile Butadiene Styrene (ABS), Styrene Copolymer etc.”