June 13 , 2008

Dear Valued Customer:

NG and Crude Oil prices have increased so rapidly the feed stock prices have not kept pace creating a situation where the market is face with increases never experienced in our history

In recent months Styrene cost are up $0.10/lb and are continuing to rise

Maleic Cost are up over $0.15/lb.

Phthalic Cost due to Orthoxylene have increased monthly for a total of $0.125/lb this year excluding a toll fee increase of $0.01-$0.02/lb

After a correction in price earlier in the year, MEG and DEG prices are back on the rise due to cost and tight inventories from turnarounds and exports

PG prices are rising sharply due to propylene and an extreme effort by Producers to recover margins

DCPD at current market prices in a money loser relative to alternative fuel values, so Producers have announced a $0.12-$0.13/lb July 1 increase

PIA Producers after last years sharp price increases have been able to absorb higher metaxylene cost. The PIA market fundamentals are changing as new capacity comes on in Japan and Korea and Producers are looking to export that additional volume to the U.S.

Many other Raw Materials such as Neo-Pentyl Glycol, Adipic Acid, Epoxy, Alcohols, Purified Terephthalic Acid have all been increasing steadily and now those increases are accelerating

Drum Price due to Steel Prices have increased 30-40% in the last two months with more to come

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