Ludwigshafen, Germany August 17-- BASF AG says it will turn away back business if it cannot raise prices for its styrene-based and nylon products because of the soaring price of benzene, the main feedstock for styrene and caprolactam.
The company has only partially passed on the increases in the price of raw materials, especially benzene, to its plastic customers in recent months and margins have suffered as a result.
If higher sales prices cannot be implemented in the short term, the company sees itself forced to forego these orders.
The Aug 2004 benzene contract in Europe was settled last week at EUR 895/tonne, a rise of 16-17% over Jul contracts and a record in Europe. US Aug benzene contract negotiations were completed at a US record of $3.85/gal, a rise of 78% over Jul.
Since January, US spot prices have more than doubled to an all-time high of $4.25/gal, before falling to around the $3.70 range. But an outage in Europe sent prices soaring late last week back to the $4 range. Spot and contract prices in Europe and elsewhere are also at all-time highs.
