The spread between Asian styrene monomer and benzene prices widened to a six-week high of $356.50/mt Thursday, up $20/mt or 6% from a day earlier, as China's shrinking SM inventories lifted SM prices, Platts data showed.
The last time the spread was wider was March 28, at $368.50/mt.
Asian SM prices rose $19.50/mt day on day and jumped $45/mt week on week to be assessed Thursday at $1,651/mt FOB Korea and $1,681/mt CFR China.
The benzene FOB Korea benchmark fell $1/mt day on day but rose $9/mt week on week to be assessed at $1,294.50/mt Thursday.
The recent surge in SM prices was driven by tight supply in China's prompt market as spot cargo inventory in eastern China shrank by about 15,000 mt week on week to 60,000 mt, the lowest level heard since January, according to market sources.
Traders and end-users in eastern China held estimated SM inventories of 80,000-90,000 mt, sources said.
The Asian benzene market has been rangebound at $1,280-$1,300/mt for the past two weeks due to sluggish demand from Chinese buyers on high inventory and cheaper domestic cargoes.
A Chinese buyer said the benzene market was "not active lately as imported cargoes are more expensive than domestic cargoes."
SM is made of about 80% benzene and 30% ethylene.
The Asian ethylene market was on the rise this week with the CFR Northeast Asia marker assessed at $1,190/mt Thursday, up $25/mt from Wednesday and up $30/mt from a week earlier. Firmer downstream markets and limited offers drove up prices.
"Ethylene derivatives prices are firmer and thus buyers are able to accept a higher price," a Western trader said.
A Chinese end-user added: "Offers are scarce as not many sellers have vessels to load material."
