Prices for solid polystyrene resin in North America have increased by an average of 4 cents per pound since Dec. 1.
The increase was tied in to stronger seasonal demand and higher prices for benzene feedstock, market sources said. Benzene is used to make PS precursor styrene monomer.
The December price hike means that regional solid PS prices for the year finished up by a net of 4 cents per pound. Through November, solid PS price volatility for the year — including increases and decreases — had totaled 12 cents, but had left solid PS prices in the same place they had been on Jan. 1.
Through November, PS sales for 2013 were up 0.6 percent to just over 4.2 billion pounds, according to the American Chemistry Council in Washington. That may not sound like much, but it's put the regional PS market on track to show demand growth for only the second time in the last decade. The last time the market notched demand growth was in 2011.
An improving U.S. economy has boosted demand for many of the consumer-based products that rely on PS — particularly those in the food service and food packaging sectors. Sales of PS into that sector grew 0.7 percent to almost 2.5 billion pounds in the first 11 months of 2013, according to ACC.
PS sales into electrical/electronic uses — including major appliances — grew 1.7 percent to almost 360 million pounds in that period.
The 4-cent December hike surprised some market watchers, since demand and upward pricing pressure for PS tend to taper off later in the year. The hike was tied into higher prices for benzene, which stood at $4.10 per gallon in November — a drop of 6 percent from the previous month — before climbing to $4.48 per gallon in December, supporting the hike in PS resin.
Benzene prices for January already have settled at $4.84 per gallon — for a two-month hike of 18 percent — leading market watchers to expect another possible PS resin price hike.
Two incidents affected benzene and PS availability in the last four months of 2013. On Nov. 19, a steam explosion killed two workers and caused the shutdown of a Total SA plant making benzene and mixed xylenes in Antwerp, Belgium. While in mid-September, a power outage at a PS plant operated by Americas Styrenics in Torrance, Calif., resulted in the loss of several days of production and led to delayed shipments.