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Thursday, October 21, 2021

Europe styrene margins decline by a quarter since end of Q2

European styrene production margins have shrunk by 25% in the third quarter, Platts data shows, weighed down by firmer feedstock and styrene length in Europe.

The European spot prices of benzene, styrene and ethylene were assessed at $687.50/mt CIF ARA, $984/mt FOB ARA and $1,008.36/mt FD NWE on Tuesday, respectively.

Using industry estimated ratios of 0.79 benzene and 0.29 ethylene to produce ethylbenzene, the precursor for styrene, feedstock costs for styrene were $835.55/mt as of September 6, up from $813.58/mt at the end of the second quarter.

In the same period, the spot price of styrene has fallen by $31/mt from $1,015/mt FOB ARA at the end of the second quarter.

One chemicals trader speculated that styrene producers may consider cutting run rates.

“When the ethylene is so expensive exports from Europe are not possible,” he said, adding: “Styrene is long, we are in contango, there are more offers than bids. The only thing that is giving support to the price are the cost economics of it.”

A second trading source noted that styrene deals had been few and far between, and most business done consisted of traders releasing stored contango barrels into the spot market.

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