In this list

European styrene loses close to third of value in 1.5 months amid fractious year


Petrochemical trends H1 2022: Continued challenges amid latest wave of COVID-19

Energy | Oil | Refined Products | Jet Fuel

Platts Jet Fuel


2022: What drives the Global Iron Ore Markets?

Petrochemicals | Energy | Oil | Natural Gas | Energy Transition | Electric Power | Agriculture | Refined Products | Naphtha | Jet Fuel | Gasoline | Crude Oil | NGL | LPG | Hydrogen | Fuel Oil | Olefins | Renewables | Electricity | Biofuels | Aromatics | Emissions | Polymers | Solvents & Intermediates

REFINERY NEWS ROUNDUP: Hydrogen projects in focus in Asia-Pacific

Agriculture | Grains | Energy | LNG

High natural gas prices could lead to spike in food costs through fertilizer link

Listen: European styrene loses close to third of value in 1.5 months amid fractious year

S&P Global Platts European styrene editor Olu Shaw joins EMEA petrochemicals managing editor Ng Baoying to assess the European styrene market, which has lost close to a third of its value in the two months to mid-November, from $1,422/mt mid-August, to $979.50/mt.

While some sources consider the dip a price correction many have been waiting for, other market participants have not been as positive about the drop, which has been driven by weakened demand, high inventory levels in Asia, logistical challenges on the Rhine resulting in high inventories in Europe, and decreases in the energy complex.

China styrene leads global prices after ADDs, followed by Europe and US in H2 2018


Platts Petrochemicalscan daily price assessment market reports provide you with a complete view of the global aromatics market, helping to identify new opportunities and make informed trading and business decisions. Click the link below to see how it can meet your needs.

Free Trial
View Full Transcript

BY: Hello and welcome to S&P Global Platts Commodities Spotlight podcast. I'm Ng Baoying, managing editor at the EMEA petrochemicals team, and I'm joined today by my team mate Olu Shaw, editor, who covers the styrene chain.

2018 has been quite a year for styrene, after coming off a rocky 2017. While styrene started the year off on strong footing and on an uptrend, the demand and supply environment was finely balanced. Events throughout the year, such as the Chinese anti-dumping duty, and low Rhine water levels, have resulted in significant price fluctuations.

More recently, styrene prices have lost close to a third of its value over the past two months, after hitting a second half peak at $1,422/mt on an FOB ARA basis mid-August. Year to date, styrene prices are down around 37% from its peak in February this year, where it was $1,561.50/mt. Contract prices in November also sank Eur170/mt, to settle at Eur1,140/mt from the month before.

Olu, you've seen a lot of changes in the past couple of months, can you give us some background on the styrene environment?

Olu: Definitely, styrene prices have come off steeply in recent months. There have been several factors at play affecting the styrene market.

In September we saw increased imports arriving in Europe following force majeure at LyondellBasell and Covestro's jointly owned propylene oxide/styrene monomer unit in Maasvlakte, the Netherlands. These imports led to market length especially after the plant restarted, and combined, these factors led to the downtrend.

Apart from supply side factors, demand for styrene has been weakening. Some market participants say this is typical of the market's seasonal behaviour close to the year end, and are not fazed by declines in prices.

Meanwhile, external demand for European styrene has also been weak. Europe typically sends volumes to Asia, and Asia now has high inventory levels of styrene, which has reduced its import demand.

Thirdly, styrene prices also felt the Domino effect of lower crude prices, which had led to decreases in the energy complex overall.

This week, the market fundamentals remain weak. The poor market sentiment has continued with further falls in prices, and market participants anticipate even more falls beyond that.

BY: Styrene, as most of us know, is a very globally traded product. Can you share more about the European styrene market's relationship to Asia, and how the Chinese anti-dumping duties have transformed that?

Olu: As mentioned earlier, the Europe-Asia relationship is a strong and ongoing one, where European cargoes have consistently been bought by Asia, especially China.

Earlier this year, China imposed antidumping duties on imports from the US, Korea and Taiwan in the second half this year, making it more expensive for Chinese buyers to procure styrene from these regions.

As a result new trade routes emerged. As European exports do not attract a duty, this made product from the region more competitive, and there have been more European exports to China. On the other hand, US exports, which now attract a duty in China, have sought alternate homes, such as to Europe, which has led to an increase in US volumes to Europe.

Overall, Europe has now become a hub for styrene with significant increases in the inflows and outflows of the product.

BY: With the anti-dumping duties in place, the price spreads between regions have naturally been very closely watched this year.

Arbitrage windows have also opened and closed throughout the year. How have pricing relationships between regions played out?

Olu: Since the antidumping duties have been imposed, we've seen a three tier pricing structure emerge globaly, where US prices have been the lowest, followed by slighter higher European prices, and with Asian prices the highest.

Styrene arbitrage window to Asia shut styrene supply in Europe lengthened significantly in October, especially with the arbitrage window to Asia closed, keeping the bulk of European volumes locked within the region.

This is likely to continue with the arbitrage window firmly shut as Asian styrene prices also fell significantly over the same period.

The weak downstream market in Asia has also been unsupportive of styrene prices.

- Downstream margins have been weak in Asia, with ABS experiencing negative margins. While the downward trend in feedstock styrene would imply lower costs and improved margins, this is yet to be realized.

- According to market sources, end-users are also aware of the low styrene prices, which in turn led to lower bids.

- Downstream participants are seeking the "right price." Exacerbating the situation, imports continued to arrive from the US, adding supply and further lengthening the market.

BY: Now looking downstream in Europe – how do you see the rest of the styrenics chain reacting or adapting to movements in its key feedstock styrene these year?

Olu: *Downstream - Weak demand from downstream which is also suffering from poor demand.

*ABS - The European acrylonitrile butadiene styrene market remained bearish amid lower feedstock costs and weak demand.

- Demand for European origin product was low in November as imports were heard in the market. We have heard from distributors that there are competitive offers from Asia for shipment in November to arrive in December.

- Demand for European-origin product on a spot basis has been slow while contract basis deliveries were said to be balanced.

- While demand for material had increased in November, customers were buying in line with their needs. Customers remain reluctant to buy more than they really need for the month. Germany's automotive industry is a major consumer of ABS. Demand for ABS is low particularly the automotive [industry] in Germany

BY: For me, one of the interesting aspects of the styrene market is how it's still in flux, and 2019 is likely to still continue to be a year of adapting to changes.

Just last month at EPCA there was quite a bit of chatter around it, and I've heard from some sources that there are more requests from customers looking to ship volumes from Europe to Asia, giving producers in the region more options.

On the other hand, European consumers who require Europe-origin styrene monomer may face increased competition for product.

However, we've heard that while competition for European-origin material has increased, some consumers who require origin-specific material already have good relationships with local suppliers who are likely to continue supplying these volumes.

The size of this origin-specific requirement is also small relative to the rest of the market, and for the time being, there's no dollar premium on this requirement.

What are some of your thoughts on the year ahead, Olu?

Olu: Looking at Platts data, over the past 2 years prices tend to recover at the beginning of the year as we begin to see increasing demand.

2018 was a year we saw several styrene outages in Europe. 2019 has already been called the year of cracker turnarounds. Major producers Dow, Versalis, BASF Shell, have planned outages next year.

One of the products to be effected is ethylene, which is one of styrene's feedstocks. As a result there will be less ethylene, ethylene will be tight and leading to tightness in styrene which may cause higher prices for styrene as buyers seek to secure volumes.

There could also be increased imports of styrene as we saw when the Maaskvalkte unit in the Netherlands went down in August.

Also, Saudi Arabia has announced it will reduce oil supply in response to lower demand, and more cuts could follow next year. Their oil output would fall by 500,000 barrels per day in December.

Members of the Organization of Petroleum Exporting Countries (OPEC) and its allies could reduce supply further next year if needed which could lead to a knock on effect of higher prices within petrochemicals.

BY: Thanks Olu, and thank you for listening to our podcast.

If you have any thoughts on our discussion that you'd like to share with us, drop us an email at or