Lead: Recently, the Shandong hydrogenated benzene market has pulled back from its highs, with mainstream transaction prices referencing 10,000–10,350 CNY/ton. Although pure benzene is supported by port destocking and high crude oil prices, declining rigid demand procurement in Shandong downstream sectors, coupled with coordinated price pressure from some downstream enterprises, has led to consecutive downward adjustments in hydrogenated benzene prices.
Crude oil remains elevated, and East China port inventories continue to decline, yet this has failed to support a rise in pure benzene prices.
The core reason lies in the weakening demand side in the Shandong region. Rigid procurement volumes from Shandong downstream enterprises have dropped significantly. Some downstream companies have even adopted strategies of coordinated price suppression, causing delivered prices for hydrogenated benzene to fall consecutively and disrupting factory shipment rhythms. As trading sentiment weakens, factory quotations have subsequently retreated.
Additionally, changes in several key hydrogenated benzene metrics warrant attention:
Current profit distribution within the pure benzene industry chain exhibits significant structural divergence, which is the fundamental cause behind downstream enterprises' coordinated price suppression and resistance.
| Product | Oct 29 | Oct 22 | Change Value | Change % | Next Period Forecast |
|---|---|---|---|---|---|
| Pure Benzene | 1799 | 2387 | -588 | -24.63% | 1500 |
| Styrene | -114 | -379 | 265 | 69.92% | -90 |
| Phenol | -1113 | -1488 | 375 | 25.20% | -1100 |
| Caprolactam | 384 | 494 | -110 | -22.27% | 410 |
| Aniline | 5189 | 5014 | 175 | 3.49% | 5300 |
| Adipic Acid | -2359 | -2239 | -120 | -5.36% | -2300 |
Data Source: Chempricehub Information
Pure Benzene Profit Contraction: The weekly theoretical profit for pure benzene fell to 1,799 CNY/ton, a drop of 588 CNY/ton (a decline of 24.63%). While the absolute value remains relatively high, the downward trend is evident, with forecasts suggesting a further decrease to 1,500 CNY/ton in the next period.
Severe Downstream Profit Divergence: Aniline remains the "profit king," with margins as high as 5,189 CNY/ton. In contrast, phenol (-1,113 CNY/ton), adipic acid (-2,359 CNY/ton), and styrene (-114 CNY/ton) are all operating at a loss. Notably, while losses for styrene and phenol narrowed slightly during the week, overall pressure persists.
The combination of high profits for pure benzene upstream and sustained losses for certain downstream products inevitably leads downstream factories to reduce loads, cut procurement, or engage in coordinated price suppression to reclaim margin space from upstream suppliers.
| Product | Oct 29 | Oct 22 | Change % | Next Period Forecast |
|---|---|---|---|---|
| Styrene | 61.81% | 62.80% | -0.99% | 62% |
| Phenol | 72.97% | 76% | -3.03% | 79.75% |
| Caprolactam | 70.79% | 70.03% | 0.76% | 70.79% |
| Aniline | 81.04% | 79.79% | 1.25% | 82% |
| Adipic Acid | 71% | 71% | 0.00% | 71% |
Data Source: Chempricehub Information
Recently, the phenol operating rate dropped sharply by 3.03% to 72.97%, and the styrene operating rate also declined slightly by 0.99% to 61.81%. This indicates that some loss-making downstream sectors are substantively reducing production.
Forecasts for the coming week suggest that the phenol operating rate is expected to rebound significantly to 79.75%, and aniline is also projected to rise to 82%. This implies that although current demand for hydrogenated benzene is weak, the anticipated resumption of operations among major downstream users will provide some support for pure benzene and hydrogenated benzene demand next week.
Geopolitical tensions in the Middle East have entered a window for diplomatic mediation. While the risk of large-scale conflict has temporarily subsided, friction between the US and Iran remains, Houthi attacks persist, and geopolitical risks may recur, providing strong downside support for oil prices. International oil prices are expected to continue rising next week, with WTI likely ranging between $97–$107/barrel and Brent between $110–$120/barrel. High crude oil prices establish a firm cost floor for pure benzene and hydrogenated benzene, preventing substantial downward movement.
Regarding supply, some refinery units previously shut down for maintenance plan to restart, leading to an expected increase in pure benzene supply. Conversely, some hydrogenated benzene units plan maintenance before winter, suggesting a slight decrease in output. This self-imposed supply contraction for hydrogenated benzene serves as a key factor supporting prices against declines next week.
On the demand side, anticipated increases in operating rates for major downstream products like phenol and aniline suggest higher rigid demand for pure benzene. Regarding inventories, East China pure benzene port stocks are expected to accumulate slightly next week, but the magnitude will be limited, and absolute inventory levels remain relatively low.
In summary, domestic fundamentals for pure benzene maintain a tight structure, though absolute industry chain prices remain elevated. The market is currently pricing in bearish expectations regarding future refinery restarts and increased imported supply. Under bearish capital positioning, short-term prices for pure benzene and hydrogenated benzene may continue their pullback from highs. However, considering that external crude oil prices remain high and hydrogenated benzene faces its own production reduction expectations, the downside potential for hydrogenated benzene next week appears limited. The overall trend is expected to be oscillating with minor declines, with mainstream transaction prices likely ranging between 9,500–10,200 CNY/ton.
Comments
0