Will the Asian PS market follow the ABS uptrend?

ABS sellers in China and Southeast Asia were encouraged to slightly increase their quotes last week. The main factors driving the market up are the recovery in crude oil futures prices as well as improving end consumer demand.

However, PS remains unaffected by the uptrend in crude oil prices, while whether this product is supported by the uptrend in styrene this week remains to be seen.

Imported ABS bolstered by low supply, falling crude oil prices

The recovery in the Asian ABS market was driven by tight supply in China as well as improved end-consumer demand.

Price ABS in. Imports of all origins rose 10-30 USD/ton, to 2240-2310 USD/ton CIF, cash at the end of last week. The market was also affected by a drop in domestic supply due to plant maintenance activities in East and Northeast China.

China's Shandong Hai Jiang and Liaodong Hua Gong are currently undergoing maintenance, while the restart of Liaoning Petrochemical's plant will be delayed until September. Ningbo LG Yongxing will also carry out scheduled maintenance in September.

Import quotes to Southeast Asia also followed the above trend, despite demand impacted by the virus due to curfews in Thailand, Malaysia, Indonesia, and the Philippines. ABS in. is estimated to increase slightly and reach 2270-2330 USD/ton CIF, cash at the end of last week.

Overall, the markets are underpinned by a higher energy complex, with WTI (NYMEX) futures reaching close to $69/bbl in intraday trading on Monday after rallying on Friday.

Disrupted oil production in the US Gulf Coast could lead to a bull market in the near term, which could support downstream benzene and styrene markets, according to some market participants.