September to See Sideways Movement in Aromatics Prices
In August, the prices of the majority of the items in the aromatics industrial chain witnessed downward fluctuations overall. Prices of benzene and downstream products inched down, while those of the PX-PTA industry chain dropped more significantly.
Toluene/xylene-PX-PTA industry chain
The overall decline in prices of toluene/xylene, PX, and downstream products in August ranged from 6% to 8%. For one thing, the decline in international crude oil prices intensified the negative impact on the cost side. For another thing, the demand in the oil blending market was sluggish, but the domestic and international supply of PX was relatively abundant. At the same time, there were planned and unplanned shutdowns of PTA plants, which exacerbated the supply-demand contradiction. The sluggish orders from film and terminal spinning businesses also contributed to the price decline. The prices of the majority of the items in the industrial chain significantly decreased as a result of the combined negative pressures of cost and supply and demand.
Benzene-styrene-ABS/PS/EPS industry chain
From the perspective of changes in industry chain profits, the loss pressure on styrene producers in August mitigated to some extent because the price difference between benzene and styrene remained reasonable. In downstream industries, the costs of GPPS and EPS remained high but their prices retreated against the backdrop of weak supply and demand structure, so their profits narrowed in August. HIPS and ABS producers reduced production to keep prices stable, so their profit loss was alleviated. Due to the low prosperity and weak supply and demand fundamentals of the toluene/xylene-PX industry chain, the majority of products saw a decrease in profits from July to varied degrees.
The aromatics industry chain is set to see limited ups and downs in September.
According to projections, September might see the aromatics markets stay range-bound. The demand in most terminal markets is expected to strengthen during the traditional peak season in September and October, and the supply and demand pattern is also likely to improve, giving prices some support. The sharp drop in crude oil prices at the start of September, however, raised concerns in the market and might put pressure on China’s chemical products. September could see sideways movement in aromatics prices amid the tug-of-war between optimistic and pessimistic news, with increased pressure for an upswing.
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