The jump in Northwest European styrene monomer prices over the past week is due to a combination of short-covering by market participants who took long positions at the beginning of the year and turnarounds at styrene production plants in Europe, sources said Monday.
“Some traders took long positions and have now come up short — this has been pushing up spot prices over the last week,” a source said Monday. “This is on top of all the turnarounds in Europe, which have been pushing spot prices up since mid-February.”
Northwest European styrene barges were assessed at $1,232.50/mt FOB ARA Friday, up $127.50/mt week on week, or 12%.
Prices have risen $287.50/mt, or 30%, since mid-February when they were assessed at $945/mt, according to Platts data.
Other sources said up to 20% of European styrene capacity would be taken offline for turnarounds in March and April, which includes facilities in France, the Netherlands and the Czech Republic.
Current prices put the spot market at a 6% premium to the March European contract price of Eur1,070/mt ($1,162/mt) FOB ARA.
One source also said spot prices were not sustainable at a premium to the March ECP and would eventually normalize to a traditional discount in the coming weeks after the short covering ends.
– Platts.com
