seagamessepaktakraw| Pure benzene started down by 70.2% and high inventory support valuations from June to July, focusing on maintenance trends

News summary

Domestic pure benzene operating rate fell to 70seagamessepaktakraw.2%, inventories fell, valuations hit year-highseagamessepaktakraw; Medium and long-term prices are strong, and we pay attention to the maintenance trends of China and South Korea. Supply and demand of styrene are stable, profits are damaged, and prices fluctuate due to emotions. Attention should be paid to the trend of raw materials.

Newsletter text

[Pure benzene prices were strong this week, and the operating rate fell to 70.2%]

Domestic refineries have continued to experience high maintenance periods. This week, pure benzene output continued to be under pressure, and the operating rate dropped to 70.2%. Although the overall downstream profit has declined, there has been no obvious negative feedback, and downstream demand is relatively stable. Port inventories fell slightly month-on-month to 47,700 tons, and extremely low inventory levels have become a key factor supporting the market.

[The price difference between pure benzene and naphtha expands to near the highest point of the year]

The price gap between pure benzene and naphtha further widened to US$396/ton this week, close to the annual high, highlighting the prominent position of pure benzene in the industrial chain. Despite this, it is expected that the strong position of pure benzene in the medium and long term will continue, and the phenomenon of high prices and high valuations will continue to exist.

[It is necessary to pay close attention to the dynamics of high-maintenance equipment in China and South Korea from June to July]

From June to July, the market will focus on the trend of high-maintenance equipment in China and South Korea. If these units resume production in a concentrated manner, it may put some pressure on the high valuation of pure benzene, but the impact is expected to be limited.

[Styrene operating rates remain stable, and total inventories are at historical lows]

There was little change in equipment in the styrene industry this week. The new maintenance volume offset the recovery volume, and the operating rate remained at 69.42%. Although downstream ABS and EPS operating rates have increased and PS operating rates have dropped slightly, the total inventory of factories, warehouses and ports has remained at historically low levels, indicating that the supply-demand relationship has not deteriorated significantly.

[Sentiment in the styrene market fluctuates, and prices have consolidated after experiencing violent fluctuations]

Although the fundamentals of supply and demand of styrene did not show obvious contradictions, due to market sentiment, prices experienced violent fluctuations and then fell into consolidation. Far-end market expectations are still uncertain, and the supply-demand relationship may weaken slightly from June to July, but the fundamental driving force is still not strong.

[Styrene profits continue to be under pressure]

The non-integrated profit and PO/SM production profit of styrene are-783 yuan/ton and-1052 yuan/ton respectively, indicating that the profit margin of styrene continues to be compressed. Although the boost in market sentiment has caused the valuation of styrene to be repaired, the market outlook is still under pressure.