LOS ANGELES , December 28, 2012 (Industry Intelligence Inc.) –
The U.S. styrene market is expected to stay weak due to low demand both in the U.S. and overseas, but feedstock benzene will remain firm due to tight supplies and the financial situation globally, according to sources, reported ICIS on Dec. 27.
Despite the poor outlook for U.S. styrene, some producers expect to see a slight increase in production rates. However, if benzene prices remain high, it will continue to put cost pressures on styrene. Benzene prices reached record highs in 2012.
The softness in styrene markets was echoed in recent data for production and inventory released by the American Fuel and Petrochemical Manufacturers and import/export data released by the International Trade Commission, ICIS reported.
Weak demand for styrene and record-high benzene prices led some styrene producers to consider selling off their feedstock benzene to raise capital. Strong feedstock costs rather than demand gradually pushed up styrene prices in the second half of 2012.
This year, the seasonal demand uptick in September and October did not occur; and weak domestic and overseas demand early in the fourth quarter, especially in Asia, led to limited orders in the year’s second half, reported ICIS.
During the first half of 2012, the U.S. styrene market was volatile. The typical increase in demand that normally occurs ahead of the summer packaging season, in April and May, also failed to materialize.
Styrene production was reduced in September when Hurricane Isaac caused some curtailments, including brief shutdowns at the Total Petrochemicals’ Carville facility in Louisiana and Americas Styrenics LLC’s St. James facility in Louisiana.
Styrolution Group GMBH has its 485,000 tonnes per year styrene plant in Texas City, Texas, offline until January, ICIS reported.
The primary source of this article is ICIS, New York, New York, on Dec. 27, 2012.
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