In May 2023, due to the reduction of imports and shrinking demand, the daily level of supply and demand was lower than in April. June is expected to surpass May on both sides of the supply and demand, but hopes for a recovery in demand brought about by the restart of downstream devices.

The monthly production of pure benzene in May 2023 is estimated at 1.577 million tons, an increase of 23,000 tons from the previous month and an increase of 327,000 tons from the same month last year. Based on the total capacity of 22.266 million tons, the capacity utilization rate was down 1.3% from April to 76.2% based on the operating rate of 8,000 hours. The maintenance loss in the month was 214,000 tons, an increase of 29,000 tons from the previous month. Maintenance losses in May are expected to be the highest of the year. In May, the pure benzene production was estimated to be 1.577 million tons, and the daily production was estimated to be 50,900 tons, lower than the daily production of 51,800 tons in April. In terms of import volume, affected by the opening of the arbitrage window between the United States and South Korea and the low price in China, imports in May were assessed at 200,000 tons or lower.

On the demand side, downstream demand in May was estimated at 2.123 million tons, lower than the level of 2.129 million tons in April. The consumption of p-benzene in the downstream of the main body of pure benzene (styrene, caprolactam, phenol, aniline, adipic acid) was 2,017 million tons, an increase of 0.1 million tons from the previous month. The average daily consumption of the main downstream in May was 65,100 tons, less than the average daily consumption of 67,200 tons in April. In terms of exports, exports in May were assessed at 0.6 million tons, lower than the level in April.

On the whole, the supply of pure benzene in May was slightly less than last month due to the decrease in imports, and the demand was slightly less than last month due to the decrease in main downstream and exports. Considering that there are more natural days in May than in April, the daily levels at both ends of pure benzene supply and demand in May are lower than in April.

The output in June is expected to be 1.564 million tons, with a capacity base of 22.716 million tons and a capacity utilization rate of 76.5%. Daily production was estimated at 52,100 tons, up from 50,900 tons in May. The production increase mainly takes into account the construction of Jiaxing Sanjiang ethylene cracking plant and Zibo Junchen Aromatics extraction plant, and also makes corresponding correction to the effect of the reduction of partial disproportionation plant on the production of pure benzene. In terms of import volume, affected by the short-term opening of the China-South Korea window, imports in June were assessed at 250,000 tons or more.

On the demand side, downstream demand in June was estimated at 2.085 million tons, lower than the level of 2.123 million tons in May. The consumption of p-benzene in the downstream of the main body of pure benzene (styrene, caprolactam, phenol, aniline, adipic acid) was 1.979 million tons, down 38,000 tons from the previous month. The average daily consumption of the main downstream in June was 6600 tons, more than the average daily consumption of 65,100 tons in May, but still lower than 67,200 tons in April. The increase in demand is mainly due to the production of Zhejiang Petrochemical’s POSM new plant in late June, as well as the return of phenol overhaul equipment. In terms of exports, exports in June were estimated at 6,000 tons, flat at the level of May.

In summary, the supply of pure benzene in June was more than that in May due to the production of new plants, and the demand was more than that in May due to the production of new plants downstream of the main body. Considering that the natural days in June are less than those in May, it is expected that the daily levels of both ends of pure benzene supply and demand in June are higher than those in May.

Combined with the level of supply and demand from April to June, only with the current optimistic expectations, the downstream demand side is expected to recover in June compared with May, but it is expected to fail to return to the level of April. The supply side is expected to show steady growth with the end of the intensive maintenance period. In June, social supply and demand balance or tend to be tired. However, considering that imports in May were concentrated in enterprises, the amount to the reservoir area was relatively small; As well as the main refinery fixed supply direction caused by the reduction of pick-up expectations in the reservoir area, port storage or not obvious.

Joyce

MIT-IVY INDUSTRY Co.,Ltd.

Xuzhou, Jiangsu, China

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