Early expectations for the August styrene contract price were heard bullish by sources this week on strength in the feedstock market and upcoming turnarounds at styrene plants in Asia.
Sources were bearish about the styrene market at the beginning of July as the market saw ample supply. Turnarounds at several styrene plants in Europe came to an end in June and Europe was waiting for US product to arrive.
This contributed to the Eur125/mt ($138/mt) monthly fall in the July styrene contract price. Sources at the time were generally bearish about the styrene market for July and August.
But this week sources said their early expectations for the styrene contract price were turning bullish, pegging it at a rollover or a slight rise.
Stronger benzene prices were expected to support styrene for the remainder of the month.
“Some upwards [movement] could be initiated by benzene which looks stronger,” a source said of the styrene market.
The benzene spot price has been rising steadily through July, increasing from $656/mt on July 1 to an assessment of $688/mt CIF ARA Tuesday.
Although European downstream demand was heard slowing ahead of the summer vacation period, a source said this will be offset by lower supply as imports from the US are diverted to Asia.
On Tuesday, the CFR China price was assessed at $1,038/mt, while the European FOB ARA price was assessed at $987.50/mt and the FOB USG price was assessed at 43.25 cents l/b ($953.23/mt), showing Asia as the highest priced region.
Upcoming styrene turnarounds in Asia in August and September have led to an open arbitrage between US and Asia, shifting US interest eastwards.
The August styrene contract price is expected to settle on August 1, while its feedstock ethylene and benzene contract prices typically settle in the final week of July.
