March polystyrene margins over feedstock styrene in Europe have fallen from the all-time highs hit in February even as prices of all grades of PS rose a hefty Eur85/mt month on month, Platts data show.
While general purpose polystyrene prices contract prices were last assessed at Eur 1,340/mt ($1,490/mt) FD FD NWE, up Eur85 from February, the high impact polystyrene prices were last assessed at Eur1,425/mt FD NWE and expandable polystyrene rising by a similar amount to Eur1,345/mt FD NWE. Considering styrene for March settled at Eur1,025/mt FD NWE, this meant a Eur315/mt margin for GPPS, Eur400/mt for HIPS and Eur320/mt for EPS.
These margins are all lower than February's when PS contract prices dropped Eur30 month on month. Margins registered for GPPS, HIPS and EPS through February were Eur330/mt, Eur415/mt and Eur335/mt respectively. Converters and traders said the March margins were still very high considering the production cost for PS over styrene is just about $150-$200/mt.
"PS prices have been raised by a higher amount than feedstock styrene suggested," a converter said. Another converter said that he was expecting a maximum of Eur65/mt rise in PS contract prices for March and was surprised when greater increases were announced by producers.
Traders said they had accepted the rise from producers because there was not much product available. "Supply is tight. It is difficult to to buy PS products if one does not accept a minimum Eur80 rise over February prices," a source at one of the largest traders in Europe said.
Following the styrene settlement for March, major producer IneosStyrolution raised its contract offers for GPPS and high impact PS for January by Eur120/mt, while Trinseo raised the prices of both its GPPS and HIPS grades by Eur100/mt. Several other producers and traders followed with similar change in prices. A major EPS producer raised offers for March by Eur85/mt. PS producers in Europe do not give outright numbers for their offers but disclose the change in prices on a month-on-month basis.
"Demand for polystyrene in Europe has been strong since December. It continues to be good and now summer demand from packaging is kicking in so supply may tighten further and support prices," a producer said.
