The spread of winter weather across Europe, especially in its eastern parts, is hampering producers' attempts to increase prices of expandable polystyrene, sources said this week.
Temperatures have already dipped below freezing in Baltic countries, Scandinavia, and Russia. Even in countries like Poland and Germany, night temperatures are now hovering below zero too.
The construction sector typically reduces or even stops its activities in such conditions, thus affecting consumption of various materials, such as EPS which is used for insulation.
"[The] slowdown of building activity is visible especially in Eastern Europe [as sub-zero] temperatures at night stop outside works," an EPS producer said.
Despite a seasonal dip in demand, producers nominated this month increases in prices of around Eur30-60/mt to claw back the rise in raw materials. Feedstock styrene monomer rose Eur40/mt in November to Eur1,025/mt FOB ARA. But its own composite feedstock costs were up by only Eur15-20/mt.
With lower demand from cold temperatures and a feeling from consumers that the styrene price increase was overdone, there was strong resistance from consumers to accept producers' nominations.
Furthermore, BASF has resumed production of its styrene monomer which has been offline since the incident at the Ludwigshafen site in Germany in October. The company's EPS production is expected to be resumed shortly as well -- improving availability.
