TOKYO -- Prices for ABS, a plastic used in cars and consumer electronics, are rising in Asia owing to robust demand from China, the world's largest automobile market.
Asian spot ABS climbed to $2,040 per ton in late September, a 9% jump from the previous month and a 40% spike on the year.
Shipments of body kits and other autoparts to China, which accounts for half of global demand for ABS, have been growing. New-vehicle sales in China totaled 2.18 million units in August, according to the China Association of Automobile Manufacturers, climbing 5.3% on the year for the third straight month of increases.
Chinese demand for ABS in 2017 is expected to rise another 6% from the previous year, by industry estimates. No new plants are schedule to begin production this year, however, leaving the market looking increasingly tight.
Prices of petrochemicals used to make ABS, which stands for acrylonitrile butadiene styrene, are also up. Styrene monomer fetched $1,315 per ton in late September, 5% higher than a month earlier. Butadiene is up 9% at $1,500 per ton.
Some Japanese ABS makers are considering price hikes as raw materials become more expensive.
"We want to raise prices about 25-35 yen (22-31 cents) per kilogram within the year," said Koichi Sekine, an executive at UMG ABS, Japan's largest producer of the plastic. The company expects feedstock prices to continue to rise and seeks to pass the costs on to autoparts makers and other customers.