US ABS demand to improve as automakers restart idled plants.
Petrotahlil --Demand for US acrylonitrile-butadiene-styrene (ABS) is poised to improve now that North American automakers are restarting idled plants that were shuttered because of the coronavirus, but lower-priced imports continue to influence domestic prices.
The restart of North American auto production will help demand, as about 14% of global ABS demand comes from the auto industry, according to ICIS Analytics.
Some market participants are concerned about how quickly the economy will recover, thinking that not all consumers will start buying immediately.
Pockets of demand have emerged from the medical supply sector as there has been increased demand for blends using injection moulded flame retardant polycarbonate (PC) and ABS for the production of ventilators.
There is sentiment that the increased demand from the medical sector could sustain even when social distancing guidelines are relaxed, as many businesses are likely to implement measures to ensure the safety of their employees and customers.
Feedstock prices continue to be soft, suggesting buyers on formula pricing could see lower prices. Formula prices as assessed by ICIS fell on 29 April.
ICIS assessments for US ABS are strictly formula based and tied to upstream price movements.
Free market prices were heard below the current assessment.
Despite the pressure from imports, some market participants think domestic producers are unlikely to lower their offers further.
A market participant said it could see demand for ABS emerge for uses in items people can use during their leisure time, such as swimming pools, as many public pools are likely to limit capacity and some people are unlikely to feel safe in a crowded public pool.
ABS is the largest volume engineering thermoplastic resin and is used in automobiles, electronics, appliances and recreational products.
North American ABS producers include A Schulman, INEOS Styrolution, SABIC and Trinseo.
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