In the early stage, under the strong support of the cost end, the price of styrene rose one after another. In the short term, the pattern of tight supply of styrene is difficult to change, but after May, with the gradual resumption of overhaul capacity and weak downstream demand, the upward trend of styrene will face greater resistance.
Domestic spot prices soar
The overall price of styrene in the domestic styrene market has risen recently. The current spot price has risen to 10,925 yuan/ton, an increase of 1,275 yuan/ton from before the "May 1st" holiday. The main futures contract 2106 rose higher than the spot price. Currently, the market price of styrene in East China is around RMB 10,950/ton, an increase of RMB 1,300/ton from before the holiday; the price of styrene in South China is around RMB 11,100/ton, an increase of RMB 800/ton from before the holiday. In the international market, the Asian styrene market is boosted by the sharp rise in raw material pure benzene, and the overall trend is higher. Although some downstream sources are resistant to high-priced sources, the intercontinental arbitrage window is still open; the European and American styrene markets are supported by high costs, but Under the drag of the supply-side recovery and other negative factors, the support is slightly weak.
The monthly difference shows an obvious back structure
Since the beginning of the second quarter of last year, the main styrene contract has shown a clear upward trend. Although the price fluctuates sharply during this period, the price center has moved upward. After the "May 1st" holiday this year, the main styrene contract rose for 3 consecutive days, with a cumulative increase of over 1,000 points, a new high since its listing. At present, the price difference between the 2106 contract and the 2109 contract of styrene is 745 yuan/ton, showing a clear back structure, which reflects the current tight supply situation to a certain extent.
In terms of basis, since the Lunar New Year, the basis has been significantly stronger due to the surge in spot prices. Around mid-April, the basis was expanded again driven by the favorable market, and the East China basis was as high as 1135 yuan/ton. At present, the basis of the mainstream price of the 2106 contract in the East China market is 921 yuan/ton, and the basis of the mainstream price in the South China market is 1071 yuan/ton; the basis of the far-month 2109 contract to the mainstream price of the East China market is 1441 yuan/ton, and the basis of the mainstream price in the South China market is 1441 yuan/ton. The mainstream price basis is at 1291 yuan/ton.
Industrial chain profits maintain a reasonable level
The price of styrene is at a high level, profits in the downstream market are once again squeezed, and the start of some installations has declined. Specifically, the theoretical profit of non-integrated styrene equipment after the holiday has increased slightly. It is currently at 781.51 yuan/ton, which is 26.36 yuan/ton higher than before the holiday, while the downstream profits have increased or decreased, and some industries have seen shrinkage. It is understood that the current operating rate of EPS in the three downstream styrenes is about 49.52%, down 6.16 percentage points from the previous month. The price increase is less than that of styrene. The gross profit is 275 yuan/ton, down 400 yuan/ton from the previous month; , The gross profit was 5761 yuan/ton, an increase of 299 yuan/ton from the previous month; the operating rate of the PS industry was 68.50%, an increase of 1.07 percentage points from the previous month. The increase in the operating rate was mainly due to the recovery of Dushanzi Petrochemical’s PS equipment. In terms of profit, PS (GPPS) increased from the previous month. 115 yuan/ton.
On May 14, the Ministry of Finance, the General Administration of Customs, and the State Administration of Taxation jointly issued the "Announcement on Imposing Import Consumption Tax on Certain Refined Oils". Affected by this, the prices of crude oil and aromatic products have risen significantly, which has strengthened the support for the cost of styrene , But there are still many uncertain factors in the oil market, and we need to beware of the risk of a sharp correction in the late stage of the crude oil end. In addition, from the perspective of styrene's own fundamentals, tight supply in the short term will still support prices, but the demand side performance is not good, and styrene may maintain a high level of consolidation. In the medium and long term, considering that the pre-maintenance equipment and new equipment will be restarted or put into production at the end of May, the overall output will recover, and the tight supply of styrene will gradually ease.
Source: Chemical Network
