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Benzene market leads to higher polystyrene prices

By: Frank Esposito

November 22, 2013

AKRON, OHIO — Plastics News is correcting prices for solid polystyrene on its resin pricing chart to show a net increase of 4 cents per pound since Aug. 1.

The increases mainly were tied to changes in price for benzene feedstock, which is used to make styrene monomer. Contract benzene prices jumped from $4.07 per gallon in July to $4.17 in August and $4.40 in September. They were relatively flat at $4.37 in October before dropping to $4.10 in November.

After being flat in August, regional PS prices increased 3 cents per pound both in September and October before declining 2 cents in November, according to buyers contacted by Plastics News.

Benzene prices for December are expected to be higher after a Nov. 19 steam explosion killed two workers and caused the shutdown of a Total SA plant making benzene and mixed xylenes in Antwerp, Belgium. The incident already had pushed spot benzene prices above $4.40 per gallon as of Nov. 21.

North American PS resin availability also was affected by a power outage in mid-September at a plant operated by Americas Styrenics in Torrance, Calif. The plant lost several days of production, and shipments were delayed until mid-October, the Houston company said.

PS — both in North America and globally — has lost volume to other resins because of higher prices and some alleged environmental impacts in recent years. But market analyst Priya Ravindranath recently said at an industry conference that she expects global PS demand to grow 2 percent per year in the 2013-18 period. By comparison, demand had declined an average of 1 percent per year from 2003-13.

North American PS operating rates are expected to be 75-80 percent in that period, according to Ravindranath, an IHS Chemical Inc. analyst in Houston. That’s higher than the projected global PS operating rate of 65-70 percent.