According to the data monitoring of the business agency, the price of styrene will fluctuate and adjust in 2019, with the overall price rising first and then falling. As of December 20, the average price of styrene quoted by styrene enterprises is 7450.00 yuan / ton, which is 8066.67 yuan / ton compared with that of styrene quoted at the beginning of 2019 (January 1), a sharp drop, a drop of 7.64%, and a drop of 9.51% compared with that of the same period last year.
In the first half of 2019, the price of styrene was up and down, with an overall increase. By mid June, the price had reached a small peak. The price was around 9016.67 yuan / ton, up 11.78% from January 1 at the beginning of the year.
In January, the units overhauled at the end of 2018 and the first ten days of January 2019 were put into operation successively, and the domestic styrene supply was supplemented. Although the import volume in January was reduced by 15000-20000 tons compared with that in December, the domestic increase made up for the import reduction. The downstream demand for styrene was mainly concentrated in ABS and PS, and the ABS / PS operation rate was improved, and the demand for styrene was strengthened. On the other hand, the people’s Bank of China lowered the deposit reserve, which brought benefits to the manufacturing industry, and the bulk commodity group rose.
By the end of February, the domestic styrene inventory continued to rise, reaching a high level in recent years. In the downstream, the operating rate of ABS / PS plant had little change. Driven by the rise of crude oil, ethylene and pure benzene, the cash flow of styrene industry was compressed, and the stock of styrene raw materials by the plant increased slightly. EPS plant resumed work rapidly in 2019, and large units have basically recovered to the state before the festival. On the other hand The total styrene inventory of East China port increased by 26000 tons to 325900 tons (excluding Jiantao and huarunku) on February 20. In the end of February, the domestic styrene price continued to decline.
Since March, crude oil price has continued to break up, Brent and WTI both set a new high in the first quarter. However, downstream chemicals failed to break through the siege, pure benzene continued to fluctuate between 4600-4900, ethylene price began to fall from the high of $1200 / ton, styrene was also in the range of shocks, failed to resonate with crude oil. However, the high stock of styrene in China still restricts the possibility of styrene rising again. For downstream plants, domestic large-scale EPS / PS / ABS plants mainly purchase domestic long-term contracts and some US dollar long-term contracts. However, foreign devices gradually enter into maintenance in March, Taiwan takes the lead in maintenance, Japan’s devices gradually stop, and South Korea follows. The centralized maintenance of the unit makes the downstream contract supply insufficient and forced to purchase from the spot, which is also an opportunity for the domestic styrene factory to ship. With the continuous resumption of maintenance in North China, the supply of goods has gradually recovered, and the domestic production has accelerated to make up for the loss of imports, which has also suppressed the current situation of high inventory and sluggish market. In particular, due to the significant impact of the water explosion in Yancheng on March 21, the safety screening of the chemical plant was induced, which affected the start-up of the downstream EPS / UPR plant, and the styrene demand digestion was slow. Comprehensive factors, the domestic styrene price presents a volatile situation.
By the middle of April, although driven by the cash flow of the downstream industry, the overall load of EPS / PS / ABS was on the high side, and the stock of raw materials for styrene was on the high side in recent years. However, under the pressure of industry safety screening, the starting load was passively reduced, and the demand for styrene was weakened, resulting in a substantial increase in the stock of raw materials for styrene. Due to the lack of buying power in the downstream, the speculative atmosphere of the traders was depressed, and the port inventory remained high, the domestic styrene price was frozen.
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In May, on the one hand, the escalation of the trade war and the continuous depreciation of the RMB exchange rate contributed to a sharp rebound in domestic prices. On the other hand, the temporary and unexpected shutdown of 400000 ton styrene plant in Hanhua total has an indirect impact on the domestic market. In the downstream, the price of EPS / PS / ABS is weak, and the cash flow in the downstream is at a low point in the year, but it is still in a profitable State. In the middle and late May, the impact of the high cash flow in the downstream on the demand of styrene is still there, resulting in the continued high price of styrene.
In June, the port inventory continued to decline. As of June 19, it is estimated that around 130000 tons will return to the level of November December 2018. The downstream demand for styrene is still on, and the domestic styrene price rise will continue. Near the end of June, downstream enterprises, the operating rate decreased more or less, lack of strong support for the main market that still maintains low demand, and the price of styrene fell.
In the second half of 2019, the price of styrene continued to fall after the shock operation
In July, styrene prices rose first and then fell. After the overhaul and restart of the main unit of the outer panel, styrene gradually arrived at the port, and the port inventory increased sharply, while the port inventory began to appear the phenomenon of weak digestion, which intensified the further aggravation of the domestic styrene market. By the end of August, styrene price continued to decline and the price continued to rise. On the one hand, due to the continuous good international oil price, the peripheral guidance for styrene is good. On the other hand, because the amount of imported styrene in August is far less than that in July, the spot supply of styrene is tight.
In September, styrene began to show signs of adjustment. In August, the shipment situation in the port was good. In September, the amount of styrene arriving at the port was equivalent to that in August, and the port had no impact on the styrene market. However, the operation rate of styrene in China is relatively low, large domestic units are under centralized maintenance, the supply of styrene in China is tight, and the downstream demand enthusiasm is acceptable, resulting in a small increase in the price of styrene in the first ten days of September. By the end of September, due to the positive delivery in the early stage and sufficient styrene stock in the downstream, combined with the environmental inspection before the national day, the demand for styrene was reduced and the styrene price was lower.
Starting in October, styrene prices all the way down. With the decline of styrene price, the cash flow of styrene industry has been significantly compressed, but the factory is still generally within the profit range, and the industry’s driving rate is also on the high side. After the National Day in October, the demand for styrene in the North decreased, and the downstream EPS plant was cautious about the demand for styrene and continued to digest inventory. On the port side, the import volume continued to be on the high side in October, reaching around 300000 tons, which further led to the difficulty in digesting the port inventory. By the end of October, although the cash flow of domestic styrene industry was further compressed, it did not reach the bottom line of profit, and there was no sign that the load of domestic styrene factory was reduced or the source of imported goods was reduced.
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In November, on the basis of the port inventory of 143000 tons at the end of October, due to the delayed arrival of import goods and the concentration of some ships in the middle and late November, the arrival in the first ten days of November was less, and the port inventory was significantly reduced compared with the previous one. Due to the strong trend of the price of pure benzene and ethylene, the industry’s cash flow fell rapidly when the price of styrene fell, reaching a new low within the year, but still at the level of profit of 250-300 yuan / ton, which did not touch the bottom line of the factory’s profit, the supply side did not decrease, and the low price did not drive the explosive growth of demand, so the price of styrene in November was still low, Keep shaking.
By the end of December, styrene market showed a slight recovery. Affected by the rising market of upstream pure benzene, styrene cost support strength strengthened. The main domestic manufacturers maintain the equipment. For example, the maintenance time of Donghao equipment increases, Yuhuang temporary maintenance, the domestic goods source in East China decreases, and the production enterprises have inventory status. Downstream EPS and other main downstream profits are good, and the demand for styrene is relatively stable. These three aspects bring benefits to styrene price. However, with the increase of port inventory, the arrival of goods is greater than the pick-up of goods, and the increase of import goods offset the shortage of domestic goods caused by the equipment maintenance of domestic production enterprises, and the demand of small and medium-sized styrene downstream is limited. Overall, the styrene price rose slightly in December, but the increase was limited.
Generally speaking, 2019 is a year of strong supply and demand of styrene. Although the price has declined all the way compared with 2018, the industry profit of styrene is still good throughout the year, and the industry cash flow continuity is good.
3、 Future forecast:
According to the styrene data analyst of business club, the overall styrene price in 2019 shows a downward trend. With the approaching of 2020, the capacity of 1.92 million tons of Zhejiang Petrochemical and Hengli Petrochemical will bring supplement to the domestic styrene industry. At present, the styrene capacity will be significantly surplus in 2020, and the styrene price next year will be balanced by the operating rate of domestic enterprises, import volume, port inventory and downstream enthusiasm.
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