According to the commodity market analysis system of Shengyishe, the price of styrene in Shandong was 8000 yuan/ton on January 1st, and 8560.00 yuan/ton on December 31st, with a year-on-year increase of 7.00%. The lowest point of the price trend appeared at around 7163.33 yuan/ton at the end of June, and the lowest point appeared in mid September at 9766.67 yuan/ton, an increase of 36.34% from the lowest point.
styrene
In 2023, the overall price of styrene showed a trend of “fluctuating decline, rise, and fluctuating decline”. From the monthly K-bar chart of Business Society, the number of months in which styrene prices fell in 2023 was more than the number of months in which they rose. Among them, July had the largest upward trend, reaching 15.29%, and June had the largest downward trend, reaching 8.34%.
The specific market situation of styrene in 2023 is as follows:
In January, before the Spring Festival, under optimistic expectations after the epidemic was lifted, the price of styrene continued to rise and reached 9000 yuan/ton. After the Spring Festival, downstream demand has recovered slowly, with prices falling back to 8400 yuan/ton in February, March, and April.
In May, weak costs and pessimistic macroeconomic sentiment dragged down prices, with prices continuing to decline from 8200 yuan/ton to 7400 yuan/ton, a monthly decline of 5.84%. In June, due to the continued downward shift in raw material prices and an increase in port inventory, prices further declined, with a monthly decline of 8.34%.
In the third quarter, there were many unplanned maintenance and slow restarts of the styrene unit, resulting in a supply increase that was lower than expected; On the cost side, as crude oil enters the peak season and major oil producing countries continue to reduce production, oil prices continue to rise. At the same time, pure benzene continues to deplete inventory and supply and demand are tight, leading to a stronger price; Multiple positive factors are driving the price center of styrene to continue to rise.
In the fourth quarter, prices fluctuated horizontally. The maintenance of the styrene plant is still concentrated, with relatively low production and low port inventory, which provides good support for prices. The overall stability of downstream construction is maintained, and there is still a demand for styrene. The supply and demand of pure benzene are tight, and the price is relatively firm. Therefore, the price trend of styrene deviates from crude oil and remains fluctuating in the range of 8300-9000 yuan/ton.
Prediction of styrene market in 2024:
Cost side
In 2023, pure benzene inventory continued to decline and supply and demand were tight, supporting strong prices. The overall price center shifted upwards, and the mainstream price of pure benzene in East China fluctuated between 6040-8915 yuan/ton, with an annual increase of 10.51% as of December 31. Looking ahead to 2024, pure benzene will continue to maintain a tight supply-demand balance and be at the profitable end of the industry chain. The price trend will be relatively strong downstream. In 2024, pure benzene is expected to be put into production by 1.2 million tons, while major downstream industries such as styrene, caprolactam, and phenol are expected to build 4.28 million tons of production capacity. From the price trend, pure benzene prices will still be constrained by upstream and downstream factors, but overall performance is relatively strong, and it is expected that the market will continue to rise.
Supply side
Since 2020, styrene production capacity has rapidly expanded, with a growth rate of over 20%. In 2023, 3.755 million tons of new equipment were put into operation, with a total production capacity of 20.865 million tons, an increase of 19.81% compared to 2022. As shown in the above figure, there are plans to invest 2.8 million tons/year of production capacity in 2024, most of which are concentrated in the first half of the year, and the industry’s production capacity is still increasing. In the upcoming year 2023, styrene is still in a large production cycle, and the industrial chain will also experience concentrated production. The growth rate of production capacity in various core links upstream and downstream may reach a high level. Looking ahead, styrene is rapidly moving towards supply saturation or even excess.
Demand side
The demand for styrene mainly lies in the three downstream industries, with EPS accounting for 24%, PS accounting for 24%, and ABS accounting for 22%, totaling 70% of the total consumption. In recent years, with the expansion of PS and ABS production capacity, their proportion in styrene consumption has increased. In 2024, based on the initial estimation of the production plan and annual operating rate of the equipment, the new production of styrene is expected to reach 2.04 million tons, and the new demand from the three major downstream industries is expected to reach 4.6 million tons. The supply-demand gap is expected to be 2.56 million tons, indicating that the supply pressure of styrene will be alleviated. In summary, the increase in production capacity in the three downstream sectors is favorable for the styrene market.
styrene
The import volume of styrene in China in 2023 was 790500 tons, a decrease of 30.85% compared to 2022. The export volume of styrene from China in 2023 was 366200 tons, a decrease of 34.90% compared to 2022. Looking ahead to 2024, domestic styrene is still in the period of expanding production capacity, with abundant supply. It is expected that imports will continue to decline, and monthly imports may remain below 50000 tons/month. Affected by the continuous expansion of domestic production capacity, the profits of the equipment have been continuously compressed and have been in a state of loss or low profit for a long time. Some overseas equipment has also been affected and stopped production due to economic efficiency issues, resulting in a decrease in overseas production and an increase in domestic exports. Looking ahead to 2024, styrene exports are expected to maintain a stable and increasing trend.
The styrene data analyst from Business Society believes that in 2024, the price of styrene will be balanced by changes in cost guidance, import and supply volume, and downstream purchasing enthusiasm. From a cost perspective, pure benzene will continue to maintain a tight supply-demand balance and be at the profit end of the industry chain, with a relatively strong price trend compared to downstream. From the supply side perspective, production capacity continues to expand. From the demand side perspective, downstream production capacity continues to expand rapidly, and if the equipment is put into operation as scheduled, it will bring about a significant increase in demand. From the perspective of imports and exports, with the continuous increase of domestic production capacity, the proportion of imports and exports has reversed, and the proportion of exports has continued to increase. In summary, it is expected that the styrene market in 2024 will mainly increase compared to above 2023, and it is expected to operate mainly in the range of 7000 to 10000 yuan/ton.
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