ABS Price Drops in China Due to Increasing Load and Declining Demand
The Chinese market witnessed a price drop in the domestic Acrylonitrile Butadiene Styrene (ABS) product, while there is a remarkable growth in the inventory trend. The ABS market has seen good growth at the beginning of this month, along with various companies conducting maintenance and reducing their negative loads. This has helped to rebound the on-site supply to over 87%. Evidently, these rises in the on-site supply, while the increase in the inventory load, have resulted in the reduction in the market prices of the ABS product. The average price of the ABS was marked around 10,500 RMB/tons on the 28th of this month, which has decreased about -0.24% compared to the price rate at the beginning of July 2023.
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Moreover, the supply of raw materials has also played a major part in these price fluctuations. The limited demands of Acrylonitrile have led to reductions in its prices, ultimately leading to a decline in its supply rate. A rise in the butadiene compound was marked initially but has dropped recently while there is a significant growth in the production rate and a decrease in the market demands. However, the price of Styrene is showing a constant growth curve due to increased oil prices and high demands from the downstream industries.
The market demand for the ABS supply is degrading due to several factors, which primarily note the declining interest of the downstream industries to stock up on the product. Demands of ABS in the market are affected by the power restriction on the downstream industries, which directly affects the supply rate. The seasonal decrease in the need for products that use ABS is another factor affecting the overall supply. Additionally, the recent increase in the price trends of ABS in the market has evidently witnessed the declining interest of marketers to invest in the product.
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According to Procurement Resource, the Chinese market is experiencing a gradual decline in the ABS market rates. The price fluctuations are driven by the prices of raw materials, the rise in the supply rates, and the degrading demands of ABS in the market. The market is facing a weak status over the ABS product, which is currently unstable and is observed to attain improvement over time.
