Rising Imports Pressured Benzene Industry
According to GACC, from January to February 2025, China’s benzene imports reached 988kt, up 405kt or 69.46% YoY. With the Asia-the U.S. arbitrage window remaining closed in March, higher imports offset domestic output losses from refinery maintenance. Short-to-medium-term benzene supply-demand balance may stay under pressure, limiting price rebound potential.
The expanding domestic supply gap and a persistently closed Asia-the U.S. arbitrage window drove a notable rise in benzene imports. After July 2024, China’s benzene imports surged. SCI data shows from January to February 2025, the imports hit 988kt, up 405kt or 69.47% YoY. Firstly, from 2021 to 2024, downstream expansion widened China’s benzene supply deficit, boosting import reliance. After July 2024, weaker American and European demand for Asian benzene kept the Asia-America arbitrage window closed, diverting more Asian benzene to China.
The benzene imports increased YoY.
According to SCI, from January to February 2025, China’s benzene consumption totaled around 5,246.8kt, with imports contributing 18.83% of supply. The import dependency increased by 4.13% YoY. First, unit shutdowns and reduced operating rates at northern plants lowered benzene production post-January. Second, the sustained closure of the Asia-America arbitrage window diverted more overseas benzene to China.
Impact of rising imports on prices
Higher import dependency amplified the influence of imported benzene on domestic prices. After July 2024, a clear inverse correlation emerged. Benzene imports remained high and continued to rise. Monthly average benzene prices gradually declined from high levels. While domestic demand, maintenance schedules, and crude oil prices influenced benzene prices, the sustained influx of imports was a critical factor driving the price downturn.
Import impact may weigh heavier on benzene market.
Benzene imports have remained high since late 2024. With weak demand recovery expectations in the US and Europe, the Asia-America arbitrage window is unlikely to reopen in the short term. China’s benzene imports are projected to hit a record high in 2025. Increased imports are expected to gradually reduce the widening domestic benzene supply gap observed in recent years. Ample feedstock supply is likely to exert downward pressure on benzene prices, potentially easing cost pressure for downstream industries. Industry chain profits may shrink, improving the operating environment for downstream sectors.
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