A Chinese styrenics producer contacted by SSESSMENTS.COM informed that China’s styrenics market is in an ardent state. Compared to last week’s level, SM inventory in coastal China decreased by 11,400 tons, captured at 303,300 tons. While in the traders’ end, the inventory reported at 201,800 tons, down by 10,900 tons. At the moment, SM, PS, and ABS producers are running at maximum rates, as well as the downstream market.
Based on the information given by the source to SSESSMENTS.COM, the good performance in demand for the air conditioner and refrigerator in the local and export market led to a fast digestion rate of PS and ABS in the China market. As the weather turns warmer in China, demand for air conditioners and refrigerators is striking. The biggest local manufacturers for these products have oversold products in May and are now running at the maximum capacity to fulfil the orders. In the export market, the massive riot in the US puts citizens on a cautious stance and tends to stock up some frozen food as the weather is getting hotter day by day.
The producer also explained that the low inventory on the producers’ and converters’ ends is another reason behind the reduction in domestic inventory. In February and March, China market, in general, was on halt due to Coronavirus pandemic. During that time, producers and converters were keeping low inventory levels due to a lot of uncertainties in the market. Coming to April, trading activities started to recover and middlemen were aggressively stocking up materials when styrenics prices were low. At that time, local offers for GPPS Injection and HIPS Injection was at CNY7,000/ton-level ($990/ton) and ABS at CNY9,000/ton-level ($1,273/ton). As demand for the end-products has shown some improvements, currently traders are fervently offering the materials previously purchased at lower levels, SSESSMENTS.COM was informed.
