Supply increased considerably in June because of the lower demand but also because of what appears to be a significant increase in imports.
The rather dramatic increase in availability has reinforced the oversupply and firmly placed buyers in the driving seat of the negotiations.
What is more, amid low demand, the market is most certainly struggling to absorb the recent new capacity by Versalis, in Italy, and by INEOS Styrolution, in France.
Nonetheless, the situation on imports was a little mixed, with buyers experiencing aggressive offers while others saw a more measured approach. But overall availability of imports has increased recently. The latest trade data confirms this, showing that Europe has become again a net importer of ABS, having switched to being a net exporter last year, mainly because the high costs of transport closed the arbitrage.
The overall picture on supply could become more complicated henceforth, because costs threaten to post big increases, which could lead to another round of big losses in margins for producers in July.
The market update is an exerpt fromt the monthly report.
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