A lack of vessel space has effectively shut the styrene arbitrage from Northwest Europe to Asia despite a wide spread in prices, trader sources said.
The European spot price of styrene was assessed at $1,079/mt FOB ARA on Monday, down $8/mt on the day, as prices surged $90/mt over the last two weeks.
European traders scrambled for molecules last week as the arbitrage to Asia was wide open.
Several deals were heard done last week in a range of $1,045-$1,050/mt for November loading, and one parcel changed hands Thursday at $1,085/mt.
Styrene prices surged in China Thursday, assessed at $1,160/mt FOB Korea and $1,184/mt CFR China, leaving the arbitrage from Europe wide open. On Monday, Asian prices shed $37/mt and were assessed at $1,172/mt CFR China and $1,148/mt FOB Korea. On Tuesday, any-January loading bids on a CFR China basis were heard slightly higher at $1,175/mt.
On Monday however, the European market retraced, and there were only sellers in the market. "It is almost too late to ship now to Asia," a trader said Monday afternoon. "To get a vessel for loading next week is difficult, all the space has been booked already."
A second trader said the arbitrage to China was hardly workable at this stage. "Vessel owners filled up their space some while ago. A couple of players snatched up the [last remaining] space last week and worked that. I doubt too many companies actually booked [vessel space to Asia]," the trader said.
