Polystyrene Market Stabilizes Amid Rising Costs and Strong Demand

Key Highlights

1. Price Trends – Polystyrene prices rose by 1.73-2% initially and later by 2.25-3% before stabilizing.
2. Demand Drivers – Strong export orders and restocking in packaging and construction industries boosted demand.
3. Supply Constraints – Reduced imports and limited capacity expansions in South Korea tightened availability.
4. Market Outlook – Prices are expected to remain stable, supported by steady demand and cautious manufacturer strategies.

Polystyrene Price Trends: Upward Momentum & Stabilization

• Polystyrene prices exhibited an upward trend in early January, rising by 1.73-2% due to strong export demand and restocking in the packaging sector. This was followed by a further 2.25-3% increase, driven by growing demand from the packaging and construction industries, along with higher feedstock benzene costs. 
• However, prices later stabilized despite fluctuations in feedstock ethylene and styrene prices, reflecting a balanced supply-demand environment. Currently, imported Styrene Monomer in Kandla is priced at ₹94.5/KG.

Demand & Supply: Key Drivers & Market Constraints

• Polystyrene demand remained strong in early January, driven by a surge in export orders and increased restocking activity, particularly in the packaging sector. 
• The construction industry also contributed to higher demand in the second week. However, supply constraints emerged due to reduced imports caused by ongoing global supply chain disruptions. 
• Additionally, limited production capacity expansion in South Korea further tightened market availability.
• On the cost side, rising energy prices squeezed manufacturer profit margins, while higher feedstock benzene prices increased production costs. 
• Despite fluctuations in styrene and ethylene prices, their impact on final polystyrene prices remained limited. 
• In December 2024, the market saw a 9% price drop due to weak demand and declining new orders. Although export orders improved toward the month’s end, they were insufficient to counter the overall bearish sentiment.

Polymer Industry Updates: Production Adjustments & Pricing Trends 

• A leading Chinese Producer offered their GPPS at 1230$ and HIPS at 1310$ CFR Nhava Sheva/Mundra for March shipment.
• Americas Styrenics has shut its HIPS Unit after a process upset. The Unit is located in Torrance, California, USA with a production capacity of 150,000 Tons/Year.
• Supreme Petrochemicals increased GPPS and HIPS Prices by Rs.1500/MT w.e.f. 10th February 2025.
• Styrene Monomer Prices are assessed stable at US$ 1060/- per MT FOB Korea basis.

Expert Opinion: Stability Amid Cost Pressures

• It is expected that prices will remain stable in the near term, supported by a balanced supply-demand scenario. While cost pressures persist, steady demand from key industries may prevent significant price declines. 
• Manufacturers maintain a cautiously optimistic stance as they navigate ongoing economic uncertainties, ensuring a relatively stable market trajectory.