ABS Market Struggles Amid Weak Demand & Rising Supply

Key Highlights:

1. Stable Production Amid Weak Demand – ABS plant operating rates remained at 72%, but order inflows continued to be weak.
2. Rising Inventory Levels – Aggregate inventory reached 190,000 tons, reinforcing market oversupply.
3. Cost-Side Weakness – Prices of key raw materials (acrylonitrile, butadiene, and styrene) declined, adding downward pressure.
4. Muted Market Sentiment – Limited demand recovery and slow restocking suggest continued price consolidation.

ABS Price Trends: Variations Across Locations and Grades

• The pricing of Acrylonitrile Butadiene Styrene (ABS) varies based on brand, color, and grade across different locations. Lotte's black-colored SD-0150 (K2007) grade is priced at ₹160,000/MT in Ahmedabad.
• Meanwhile, Lotte's natural-colored SD-0150 grade is priced at ₹144,000/MT in Delhi, Ahmedabad, and Chennai. 
• Taita's natural-colored 5000W grade is consistently priced at ₹144,000/MT across Ahmedabad, Mumbai, Chennai, and Delhi. 

Demand and Supply: Oversupply Weighs on Prices

• The domestic ABS industry maintained a steady operating rate towards the end of February, with load levels stabilizing at approximately 72% since mid-month. Weekly production output averaged around 130,000 tons, while aggregate inventory levels rose to nearly 190,000 tons, reinforcing a scenario of abundant supply. 
• Despite stable production, petrochemical plants continued to face weak order inflows, while traders struggled with slow deliveries. The high incidence of discounted orders reflected the market’s oversupply. On the cost side, upstream raw materials—acrylonitrile, butadiene, and styrene—exhibited a weak trend. 
• Acrylonitrile prices declined due to increased domestic supply and sluggish demand, though supply uncertainties in March provided some resistance to further price drops. Butadiene prices weakened amid increased production capacity and weak demand for synthetic rubber, leading to overall market pessimism. 
• Styrene prices remained under pressure as supply levels increased, and early bullish sentiment dissipated, forcing the market into a consolidation phase. The weak cost structure contributed to the subdued ABS market dynamics.

Global ABS Production Updates: Major Plants Adjust Output

• LG Yongxing Chemical continues to operate its Acrylonitrile Butadiene Styrene (ABS) plant at full capacity. The facility, located in Ningbo, Zhejiang, China, has a total production capacity of 850,000 tons per year, maintaining stable output levels.
• Taita Chemical's ABS unit in Kaohsiung, Taiwan, is currently running at 70-80% of its actual capacity. With a production capacity of 100,000 tons per year, the unit is operating below maximum levels, reflecting moderated output adjustments.
• Korea Kumho Petrochemical Corp is operating its ABS unit in Ulsan, South Korea, at a reduced rate of 60-70% of its actual capacity. The facility, which has a total production capacity of 250,000 tons per year, continues to run below full output, aligning with market conditions.
• Toray Plastics Malaysia's ABS plant in Penang, Malaysia, is operating at 75% of its actual capacity. With a production capacity of 425,000 tons per year, the plant continues to function at adjusted rates, balancing supply with current demand.
• LG Chem has maintained the operation of its ABS unit in Yeosu, South Korea, at 80% of its actual capacity since the second half of February 2025. The facility, which has a total production capacity of 900,000 tons per year, remains in stable operation, reflecting controlled production levels.

Expert Opinion: Weak Demand and Elevated Inventory to Dictate Trends

• The domestic ABS market is expected to continue its weak consolidation phase in the near term. Despite cost-side fluctuations, overall support remains limited. Inventory levels at polymerization plants are elevated, and demand-side expansion remains insufficient. 
• Some downstream enterprises are slow in resuming production, further suppressing demand. Business analysts believe that given the prevailing supply-demand imbalance, the ABS market will remain weak in the short term, with price trends primarily dictated by cost-side developments and inventory adjustments.