Benzene China Monthly Report Sample 2014

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JYD CHINA BENZENE MARKETSCAN MONTHLY REPORT
December 1, 2014
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Content
Summary of Hot Spots
Benzene Product Price
Feedstock Price
Market Overview
China Benzene Plants Turnaround
China Hydrogenation of Benzene Plants Turnaround
Supply Forecast
Downstream Consumption Structure
1
1
1
1
2
2
3
3
Downstream Profit and Loss
Derivatives Run Rate Contrast
Main Derivatives Trend Analysis
Domestic and Foreign Market Arbitrage of Benzene
Competition btw Hydrogenation of Benzene and Benzene
Downstream Overhaul & Benzene Consumption Forecast
Conclusion
Appendix
3
4
4
5
5
5
6
7
Summary of Hot Spots
I. Crude oil price plunges triggered a panic in China benzene market.
II. Benzene hydrogenation cost was still of weak support despite a slowdown in crude benzene prices.
III. With a large spread between prices for hydrogenation of benzene and those for benzene, traders were active in speculating. IV. The benzene industrial chain collapsed overall.
V. Cost tumbling to below supportive levels was the biggest drag on the benzene market.
VI. The styrene market, the most important downstream market for benzene, has kept hitting fresh lows.
Benzene Product Price
Benzene Product Price, 2014
Product
Naphtha
Benzene
Hydro-benzene
Styrene
Phenol
CYC
AA
Aniline
MA
Avg. Price in Oct
751
8,088
8,056
10,742
10,507
11,316
10,508
9,263
10,678
Avg. Price in Nov
674
7,223
7,042
9,472
9,830
10,145
10,043
8,458
9,411
Benzene Feedstock Price, 2014
Product
Crude Oil
Crude Benzene
Avg. Price in Oct
84.3
6,423.7
MoM Change
-77
-866
-1,014
-1,270
-677
-1,171
-465
-805
-1,267
Avg. Price in Nov
75.8
5,500
MoM Change Rate (%)
-10.2%
-10.7%
-12.6%
-11.8%
-6.4%
-10.3%
-4.4%
-8.7%
-11.9%
MoM Change
-8.5
-932.7
$/mt; CNY/mt
Delivery Terms
CFR Japan
Ex-stockpile, East China
Cash, delivered, East China
Cash, Ex-stockpile, East China
Cash, Ex-stockpile, East China
Acceptance, Ex-stockpile, East China
Cash, Ex-stockpile, East China
Acceptance, Ex-stockpile
Acceptance, Ex-stockpile, East China
MoM Change Rate (%)
-10.1%
-14.5%
$/bbl; CNY/mt
Delivery Terms
WTI
Cash, EXW, East China
Data Source: JYD Information Co., Ltd.
Market Overview
Benzene: China benzene market staged an obvious decline in November 2014 amid falling foreign quotes, fragile purchase
and producers’ constant cuts in their listing prices. Foreign quotes for benzene tumbled by $121/mt in the month to as low as
$943/mt FOB South Korea, the lowest level in three years. Meanwhile, domestic benzene producers cut their listing prices four
times this month by a total of CNY900/mt to CNY6,900-7,000/mt. Additionally, end users were lax in procuring, while traders
were slow in taking position, with some with stocks at hand being under relatively heavy sales pressures. Therefore, transactions
prices for benzene hit CNY6,800-6,900/mt at the end of November, slumping by CNY850/mt from the CNY7,600/mt at the
start of the month.
Deals concluded this month were mainly based on contracts, and traders were restocking on demand from the end users. In
spite of prices slumping to below the CNY7,000/mt price mark, traders expected them to slide further and that the market has
not yet notched the floor. The benzene market was weak throughout the month, with flat transactions.
P-1
December 1, 2014
JYD CHINA BENZENE MARKETSCAN MONTHLY REPORT
Hydrogenation of benzene: China hydrogenation of
benzene (hydro-benzene) market retreated to nearly a fouryear low with a decline range of up to CNY1,000-1,100/
mt in November 2014, owing to plunging crude oil prices,
continuously dropping foreign quotes and constant sharp
cuts for listing prices by domestic chemical producers. At
the end of the month, trading prices for hydro-benzene had
slipped to a low of CNY6,850/mt last seen in end-2010.
In early November, international crude price nosedives
weighed on the Chinese domestic benzene market. Supply
decreased as benzene hydrogenation plants in Hebei and
Shandong arranged massive production curtailment and
unit maintenance during the APEC meetings in the first
ten days of the month, albeit providing little strength to the
market. Petrochemical producers lowered their listing prices
four times this month by a margin of CNY1,000-1,100/mt.
East China Benzene & Hydrogenation of Benzene Price
CNY/mt
10,000
Benzene
Hydrogenation of benzene
9,500
9,000
8,500
8,000
7,500
7,000
6,500
6,000
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Data Source: JYD Information Co., Ltd.
Supply and Demand Analysis
China Benzene Plants Turnaround, 2014
Region
Hebei
Hebei
Guangdong
Zhejiang
Producer
Xinqiyuan Energy
PetroChina (North China)
CNOOC
Zhenhai Refinery
‘000mt/yr
Capacity
50
70
80
490
Start Time
Early October
Early October
November 7th
October 20th
China Hydrogenation of Benzene Plants Turnaround, 2014
End Time
November 11th
November 27th
November 23rd
November 30th
Remark
On schedule
On schedule
On schedule
On schedule
‘000mt/yr
Region
Plant
Capacity
Start Time
Ningxia
Inner Mongolia
Inner Mongolia
Shandong Zibo
Shanxi Changzhi
Shandong Heze
Shandong Zaozhaung
Shandong Heze
Shandong Laiwu
Hebei Tangshan
Hebei Tangshan
Hebei Tangshan
Hebei Handan
Hebei Handan
Hebei Handan
Hebei Handan
Hebei Handan
Hebei Shijiazhuang
Hebei Xingtai
Henan Anyang
Jiangsu Xuzhou
Ningxia Baofeng Energy
Inner Mongolia Jianyuan
Inner Mongolia Kingho
Shandong Haili Chemical
Shanxi Lubao Coking
Shandong Yuhuang Chemical
Tengzhou Shengyuan Hongda
Heze Derun Chemical
Shandong Laiwu Steel
Tangshan Baoshun Chemical
Tangshan Zhongrun
Tangshan Xuyang Chemical
Hebei Yulong Chemical
Hebei Jinruite Chemical
Hebei Yida Chemical
Hebei Rongte Chemical
Hebei Taojin Chemical
Hebei Minhai Chemical
Hebei Kingboard Chemical
Henan Yutian Chemical
Xuzhou Yongpeng
100
100
100
80+80+100
100
100
80+80
50+100
100
100+100
100+100
200
50+50
100
50+50
50
50
100
50
80+80
200
November 7th
November 1st
November 1st
November 6th
November 1st
November 8th
November 1st
November 18th
November 1st
November 21st
November 6th
November 6th
November 1st
November 6th
August 28th
November 6th
November 6th
November 6th
November 6th
August 28th
August 1st
End Time
November 30th
November 30th
November 30th
November 30th
November 12th
November 15th
November 30th
November 30th
November 12th
November 30th
November 7th
November 21st
November 30th
November 15th
August 31st
November 13th
November 13th
November 13th
November 13th
August 31st
August 31st
Days
Remarks
23
30
30
25
12
7
30
12
12
10
11
15
30
9
4
7
7
7
7
4
31
Insufficient gas
Long-term turnaround
Long-term turnaround
Two lines
planned
Planned
One line
One line
Long-term turnaround
One line
For APEC
For APEC
Long-term turnaround
Planned
Trouble shooting
For APEC
For APEC
For APEC
For APEC
Trouble shooting
Insufficient fund
China Benzene Output, 2014
According to statistics, China’s benzene production
rose slightly from a month earlier to 670,000 mt in
November 2014, mainly as some units that shut down
previously resumed operation successively after midNovember.
According to JYD, in November hydrogenation of
benzene output fell 7,700 mt to 254,270 mt against
previous month, the sixth consecutive monthly cut,
which was because most companies in northern China
were in production-limiting or turnaround affected by
APEC in Beijing.
'000mt
2013
2014
1,400
1,200
1,000
800
600
400
200
0
Jan-Feb
Apr
Jun
Aug
Oct
Dec
Data Source: JYD Information Co., Ltd.
P-2
December 1, 2014
JYD CHINA BENZENE MARKETSCAN MONTHLY REPORT
Bezene & Hydrogenation of Benzene Demand Analysis
China Hydrogenation of Benzene Output
'000mt
350
2013
2014
6%
300
18%
Other
7%
Phenol
21%
250
10%
200
150
Aniline
8%
CYC
20%
24%
100
Styrene
46%
50
0
Jan
Feb Mar Apr May Jun
Jul
50%
Aug Sep Oct Nov Dec
30%
40%
10%
10%
Hydrogenation of Benzene
30%
Benzene
50%
Data Source: JYD Information Co., Ltd.
Supply Forecast
Benzene: In December benzene output will go up by 10% from November as downstream contract purchase was relatively
stable with lower offer price for stocking.
Hydrogenation of benzene: According to JYD, in December with the recovery growth in hydrogenation of benzene supply,
the run rate will be up by 7% considering restarting and seasonal factors.
Conclusion: As a whole, in December benzene and hydrogenation of benzene supply will increase sharply, especially benzene
supply, which was the principal part in supply.
Downstream Profit and Loss Analysis
Overall speaking, the profit and loss of benzene downstream industry products differentiate with each other, according to JYD
statistic, in November 2014, phenol was the only one made profit, which is above CNY800/mt. However, the other traditional
downstream products were still at a loss, such as styrene, aniline and CYC. Profits and losses of all downstream products since
the beginning of this year are shown as below, and Aniline suffered the most.
Benzene Derivatives Profit Margin
China Phenol Price and Profit Margin, 2014
CNY/mt
CNY/mt
Profit Margin
East China Phenol
13000
3000
Phenol
12000
2000
11000
1000
10000
0
Profit-Loss
Aniline
CYC
9000
Styrene
-1000
-500
0
Profit Margin
-1000
8000
500
-2000
27/Jan
1000
China Styrene Price and Profit Margin, 2014
CNY/mt
CNY/mt
MA
27/Mar
27/May
27/Jul
27/Sep
27/Nov
China CYC Price and Profit Margin, 2014
East China Styrene
13000
CNY/mt
1000
12000
500
11000
CNY/mt
13,000
Profit Margin
East China CYC
500
12,500
300
12,000
100
0
11,500
-100
10000
-500
11,000
-300
9000
-1000
10,500
-500
10,000
-700
8000
27/Jan
-1500
27/Mar
27/May
27/Jul
27/Sep
9,500
27/Nov
27/Jan
Data Source: JYD Information Co., Ltd.
P-3
-900
27/Mar
27/May
27/Jul
27/Sep
27/Nov
December 1, 2014
JYD CHINA BENZENE MARKETSCAN MONTHLY REPORT
China Maleic Anhydride Price and Profit Margin, 2014
Profit Margin
CNY/mt
11500
China Aniline Price and Profit Margin, 2014
11000
0
10500
-500
10000
-1000
9500
-1500
9000
8500
27/Jan
27/Mar
27/May
27/Jul
CNY/mt
CNY/mt
500
East China Maleic Anhydride
27/Sep
Profit Margin
12000
CNY/mt
400
11000
0
10000
-400
9000
-800
-2000
8000
-1200
-2500
7000
27/Nov
-1600
27/Jan
27/Mar
27/May
27/Jul
27/Sep
27/Nov
Data Source: JYD Information Co., Ltd.
Main Derivatives Analysis
In November, the run rate of benzene downstream
companies were stable as a whole, of which phenol run rate
was as high as 92%, followed by CYC 85%, styrene 74%,
aniline 50% and MA 40%.
Downstream Run Rate, 2014
October
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Styrene: In November, as domestic styrene market
pointed downward, the price continued to decline by about
15%-18% within the month.
Phenol: November phenol market slipped amid negative
sentiment. Up to 28th, phenol traders in East China offered
between CNY9,400-9,450/mt, down by CNY600/mt against
the negotiation price of CNY10,000-10,050/mt at the
beginning of November.
Aniline: In November, domestic aniline price dropped
further by about CNY1,000/mt, as downstream traders
lacked purchasing enthusiasm.
CYC: This month, domestic CYC market remained weak
during the slack season and downstream traders only
purchased on demand amid inactive atmosphere. Benzene
price continued to go down steeply, CPL price hovered
around CNY15,000/mt, and AA price declined drastically.
MA: In November, MA price plunged due to continuous
crude price falling, weak demand and feedstock price
decline. At the end of November, MA in North China mainly
transacted at CNY 8,600-8,800/mt, down CNY1,2501,300/mt on month; MA in Shandong mainly transacted at
CNY8,800-8,900/mt, down CNY1,300/mt on month; MA
in Jiangsu and Zhejiang mainly transacted at CNY8,9009,000/mt, down CNY1,300/mt on month; MA in South
China mainly transacted at CNY8,900-9,000/mt , down
CNY1,300/mt on-month. (acceptance included )
styrene
November
phenol
aniline
cyclohexanone
malieic
anhydride
East China Styrene Price, 2014
CNY/mt
12500
12000
11500
11000
10500
10000
9500
9000
8500
8000
27/Jan
27/Mar
27/May
East China Phenol Price, 2014
East China Aniline Price, 2014
CNY/mt
13000
CNY/mt
12000
12500
11500
12000
11000
11500
10500
11000
10000
10500
9500
10000
9000
9500
8500
27/Jul
27/Sep
27/Nov
27/Jul
27/Sep
27/Nov
8000
9000
27/Jan
East China Aniline
27/Mar
27/May
27/Jul
27/Sep
27/Jan
27/Nov
Data Source: JYD Information Co., Ltd.
P-4
27/Mar
27/May
December 1, 2014
JYD CHINA BENZENE MARKETSCAN MONTHLY REPORT
East China Cyclohexanone Price, 2014
East China Maleic Anhydride Price, 2014
CNY/mt
13000
CNY/mt
11500
12500
11000
12000
11500
10500
11000
10000
10500
9500
10000
9000
9500
9000
8500
27/Jan
27/Mar
27/May
27/Jul
27/Sep
27/Nov
27/Jan
27/Mar
27/May
27/Jul
27/Sep
27/Nov
Arbitrage Analysis
According to JYD statistic, price inversion in both foreign and domestic markets was lessened due to crude price dip in
November, reflecting a resilient domestic market and may probably lead to arbitration between foreign market and domestic
market.
Benzene & Hydrogenation of Benzene Competition, 2014
Arbitrage, 2014
Benzene FOB Korea-FOB China Arbitrage,2014
CNY/mt
12000
Spread
FOB East China
FOB Korea
CNY/mt
600
CNY/mt
3000
11000
2500
500
10000
2000
400
9000
1500
300
8000
1000
200
7000
500
6000
0
5000
-500
4000
27/Jan
27/May
27/Jul
27/Sep
Trend of Replacement
100
0
-100
-1000
27/Mar
Spread
-200
27/Nov
25/Jul 8/Aug 22/Aug 5/Sep 19/Sep 3/Oct 17/Oct 31/Oct 14/Nov 28/Nov
Competition between Hydrogenation of Benzene and Benzene
Hydrogenation of benzene has a competitive advantage over benzene due to low feedstock price and will certainly lead to
active speculations.
Downstream Overhaul & Benzene Consumption Forecast
Stepping into November, the systematic risk of crude oil started to release, resulting in an overall price crash of nearly all
downstream products. As the prices for downstream products slid sharply while that for domestic benzene decreased slowly,
most downstream products of benzene suffered a severe loss. Though phenol was profitable to some extent, the general
profitability was cut down. Benzene consumption is predicted to drop due to unit maintenance.
China Benzene Downstream Plants Turnaround, November 2015
Product
Company
Styrene
Dawang Huaxing
Styrene
Styrene
Styrene
Styrene
Styrene
Phenol
Phenol
Phenol
Phenol
Phenol
Phenol
Aniline
Aniline
Aniline
Aniline
CYC
Total
Yanshan Petrochemical
Dawang Huaxing
Anqing Petrochemical
Tianjin Dagu
Liaotong Chemical
Gaoqiao Petrochemical
Gaoqiao Petrochemical
Yangzhou Shiyou
Yanshan Petrochemical
Zhongsha Tianjin
Huizhou Zhongxin
Shandong Jinling
Shandong Jinling
Cornell
Shanxi Tianji
Neijiang Tianke
Start Time
Jun 16th
Nov 23rd
Jul 21st
Oct 8th
Nov 15th
Nov 6th
Jun 16th
Sep 15th
Sep 11th
Nov 23rd
Nov 6th
Nov 6th
Nov 11th
Oct 25th
Oct 25th
Oct 1st
Oct 1st
Oct 1st
End Time
Pending
Nov 28th
Pending
Pending
Dec 5th
Nov 30th
Pending
Nov 5th
Nov 10th
Pending
Nov 13th
Nov 13th
Pending
Pending
Pending
Oct 31st
Pending
Pending
Capacity
75
150
80
80
100
500
75
62.5
37.5
200
187.5
220
187.5
260
260
360
250
20
Benzene Demand Cut
5
12
5
5
3
13
8
1
1
2
1
1
2
11
11
16
12
2
111
‘000mt/yr
Remarks
On Schedule
On Schedule
On Schedule
On Schedule
On Schedule
Operation rate down to 50%-60%
On Schedule
N/A
N/A
Operation rate down to 60%-70%
Operation rate down to 80%
Operation rate down to 80%
Maintenance
Narrow profit
Narrow profit
Narrow profit
Narrow profit
Cost of feedstock
Data Source: JYD Information Co., Ltd.
P-5
JYD CHINA BENZENE MARKETSCAN MONTHLY REPORT
China Benzene Downstream Plants Turnaround, December 2015
Product
Styrene
Styrene
Styrene
Aniline
Company
Liaotong Chemical
Yanshan Petrochemical
SP Chemical
Shandong Jinling
Capacity
75
80
320
260
Shutdown Time
June 16th, 2014
July 21st, 2014
Late December
October 25th, 2014
Benzene Demand Cut
5
5
11
11
Aniline
Connell Chemical
360
October, 2014
16
Aniline
CYC
Aniline
Total
Tianji Group
Neijiang Tianke
Shandong Jinling
250
20
260
October, 2014
October, 2014
October 25th, 2014
12
2
11
73
December 1, 2014
‘000mt/yr
Remark
Stopped production
Stopped production
Changed catalyst
Insufficient profit
Only one plant was operating due to low
profit
Insufficient profit
Maintenance & feedstock cost
Insufficient profit
Data Source: JYD Information Co., Ltd.
Conclusion
Benzene: Concerns for the next month focused on whether China and oversea benzene market price will continue to go down,
whether listing prices of companies will be cut down, whether bottom price will appear in December, as well as the speculation of
traders. Most downstream users and traders purchased upon rigid demand, which limited the amount of trading. The declining
listing price also pared down domestic trade. Additionally, the oversea market price was easy to fall down with the slumping
crude price. Based on an atmosphere with unfavorable factors, benzene price will continue its weak trend early next month. As
traders considered cutting down inventory and some of them worried about the risk of stocking up, a bottom price would appear
in China benzene market in December.
Hydrogenation of benzene: As the fundamentals turned well in December, China hydrogenation of benzene market slowed
down its sharp plummet. Affected by new-built capacities and the maintenance termination of a few plants, the downstream
demand was in a moderate upturn. Further, based on the fade-in of cost support and the strong rigid demand, crude benzene
price rebounded after a sharp decrease in the end of this month and several new peaks appeared in auction price. The market
was shored up by short supply. However, as the expectation of production reduction at OPEC conference failed to realize, crude
price will fluctuate weakly in a downstream channel. This will bring a huge burden to the staple commodity market, which faces
relatively high systematic risks. It is suggested that transactions of hydrogenation of benzene in December should be made
cautiously.
JYD China Benzene Marketscan Monthly Report
Director
Yang Li
[email protected]
Editor
Susie Li
+86-10-84428754
[email protected]
Editorial director
Tobey Li
Wang Zhenxian
+86-10-84428620
[email protected] [email protected]
Li Hong
Chief Editor
[email protected]
Bian Cuijing
Jing Changting
[email protected]
[email protected]
Amanda Zhao
Xue Jing
+86-10-84428984
[email protected]
[email protected]
JYD Information Co., Ltd is recognized as the leading information provider in
China. We specialized in providing the transparent, high-value, authoritative
market intelligence and professional analysis in commodity market. Our
expertise covers oil, gas, coal, chemical, plastic, rubber, fertilizer and metal
industry, etc.
JYD China Petroleum Marketscan Weekly is published by JYD Information Co.,
Ltd. every week on China crude oil, oil products and fuel oil market review, price
trend refiners output figures, teapots run rate, refiners turnaround schedule and
so on. The report provides full-scale & concise insight into China oil products
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P-6
JYD CHINA BENZENE MARKETSCAN MONTHLY REPORT
December 1, 2014
Appendix
China Petrochemical Companies' Naphtha Monthly Settlement Price, 2014
Month
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Internal Supply
6,811
6,640
6,650
6,720
6,830
6,910
6,960
6,570
6,320
5,490
4,870
Sinopec
Tahe Branch’s Supply to Eastern Chemical Plants
5,811
5,640
5,650
5,720
5,830
5,910
5,960
5,570
5,320
4,490
3,870
Datuhe Crude Benzene Auction Price, 2014
Date
Nov 4th
Nov 11th
Nov 18th
Nov 25th
Starting Price
5,200
5,150
4,800
4,600
Closing Price
5,200
Auction Fail
4,800
4,770
Change
-350
-50
-350
-30
Data Source: JYD Information Co., Ltd.
P-7
CNY/mt
Internal Supply
6,312
6,209
6,016
6,028
6,125
6,236
6,292
6,570
6,320
5,490
4,870
PetroChina
Cross-regional Internal Supply
6,454
6,351
6,158
6,169
6,267
6,378
6,434
6,476
6,049
5,789
4,978
WoW Change Rate (%)
-6.73%
-0.97%
-7.29%
-0.63%
CNY/mt
Volume (mt)
300
300
300
300
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