February US domestic polystyrene contracts were settling 2 cents/lb ($44/mt) below January, sources said Wednesday.
The drop in February marked the sixth straight month of declines for US domestic polystyrene contracts after January settled 9-11 cents/lb below December, sources said.
January US domestic contracts were assessed at $1.025-1.045/lb ($2,260-2,304/mt) delivered railcar basis for general-purpose polystyrene, while high-impact polystyrene contracts were assessed at $1.125-1.145/lb ($2,480-2,502/mt) delivered railcar basis.
The decrease would put February contracts at assessments of $1.005-1.025/lb delivered railcar for GPPS and $1.105-1.125/lb delivered railcar for HIPS.
Following the February settlement, US contracts would be at their lowest level since June 2012 for GPPS and HIPS, when they were assessed at 93-95 cents/lb delivered railcar and $1.05-1.07/lb delivered railcar, respectively.
US polystyrene contracts have now dropped 25.5 cents since peaking in July and August at record-high levels of $1.36-1.38/lb delivered railcar for HIPS and $1.26-1.28/lb delivered railcar for GPPS.
Sources have cited a steep drop in upstream benzene contracts for the fall in polystyrene contracts. Benzene contracts have dropped $3.27/gal ($978/mt) since peaking in July at $5.28/gal. Benzene contracts for February settled 19 cents/gal lower than January at $2.01/gal, sources said.
Benzene makes up around 70-80% of styrene, which is the major feedstock for polystyrene, so increases or decreases in benzene have been the major driving force behind increases or decreases in polystyrene for most of the last two years.
With spot benzene last assessed Tuesday at $2.04/gal FOB US Gulf Coast, sources said benzene contracts for March could settle close to where contracts for February settled, which downstream polystyrene sources said would likely mean polystyrene contracts for March would be flat with February.
– Platts.com
