– Weaker feedstocks weigh on prices
– Sentiment-driven amid lack of clarity
Asian styrene monomer fell $8/mt day on day to $1,053/mt CFR China and $1,013/mt FOB Korea Wednesday on weakening sentiment and an uncertain price outlook. In the CFR China market, bids were heard at $1,050/mt for June arrival cargoes but did not attract any selling interest. Earlier, bids were heard at $1,030/mt CFR China for on or before May 20 arrival, with no offers heard. The laycans rolled forward from the average of H1 and H2 May to H2 May and H1 June in a flat market structure. In the east China domestic market, the May marker fell Yuan 70/mt on the day to Yuan 8,070/mt ex-tank. The fall in SM also tracked the weakness in western crude benchmarks and feedstock benzene and ethylene. An Asian SM trader said the market was lacking clarity and continued to be sentiment-driven. SM prices were expected to remain rangebound for the time being, sources said. “Despite the weak SM prices, production margins are healthy given low benzene prices. However, since Asian supply would be tighter at least until early May due to plant turnarounds, prices could be hovering within this range for a while,” one market participant said. A Chinese producer said high inventory in east China was expected to decline between April and May, but an inventory level of more than 200,000 mt could be a “new normal” this year.
Asian SM was assessed down $8/mt day on day at $1,053/mt CFR China and $1,013/mt FOB Korea Wednesday. The markers currently take the average of the H2 May and H1 June laycans. There were no transparent bids or offers during the Market on Close assessment process. H1 June was assessed at $1,053/mt, above the best bid heard at $1,050/mt CFR Zhangjiagang/Jiangyin with no offer heard, and tracking weaker sentiment in the east China domestic market in the afternoon. Maintaining the pegged flat May/June spread, H2 May was also assessed at $1,053/mt. In the east China domestic market, the May marker was assessed down Yuan 70/mt on the day at Yuan 8,070/mt ex-tank, equating to $1,043.50/mt on an import parity basis. The FOB Korea marker was assessed at $1,013/mt based on the pegged $40/mt spread to CFR China, while the CFR Taiwan marker was assessed at $1,041/mt based on the pegged $12/mt spread to CFR China.