Looking back on the trend of styrene in October, it is a good move. Affected by the strong demand downstream of the terminal, during the national day, many downstream enterprises shorten the shutdown period and scope, which leads to the non increase and decrease of the stock of styrene main port and production enterprises after the festival. Meanwhile, downstream prices are higher and styrene is pushed back. Under the promotion of good fundamentals, futures market bulls continue to increase positions, and the market of the market and spot market rise resonance.
| PVA 2088 (PVA BP20) |
At present, for styrene cost end, pure benzene market keeps up with styrene market, but the increase is narrow, and the profit of styrene industry has been improved. Crude oil, as the upstream source of styrene, is suppressed, which also compresses the space of styrene price rise to a certain extent, and also lowers the price of pure benzene and ethylene.
From the current international maintenance devices, cosmar has an annual capacity of 575000 tons of parking and maintenance for nearly one month, South Korea SKG has an annual capacity of 45000 tons of units for parking and maintenance, and Singapore shell has an annual capacity of 550000 tons in October for two months. The annual output of Italian, Belgian and Japanese production capacity is about 1795000 tons in October; besides, the annual output of triseo in Germany is 300000 tons The styrene plant is scheduled to be shut down permanently.
It is worth noting that since the late July, domestic production enterprises have export orders, which is a signal of the change of market supply and demand pattern. In recent two years, a large number of new production capacity has been put into operation in China. By october2020, China’s total styrene production capacity has reached 11.665 million tons. The integrated unit has rolled over many non integrated old-fashioned devices in terms of production profit, seizing market share, which leads to the situation of capacity shutdown of foreign old-fashioned devices. In the future, we should continue to observe export data, so as to judge the possibility of changing international trade pattern 。
In this context, the port stock of styrene in China was successively removed from 306000 tons at the end of August to 211000 tons at the end of October. On the one hand, the centralized maintenance equipment in foreign countries led to the reduction of imported goods sources, on the other hand, the production enterprises actively went to the warehouse and pre sold the spot. The existing enterprises were pre sold to December. Meanwhile, downstream enterprises were actively seized goods due to the market supply tension, and both pipes were together Next.
| PVA 1799 (PVA BF17) |
At present, the plant maintenance in China is less, the domestic load is still high, the domestic output changes little in the four seasons, and it is possible to raise negative on the basis of high profit. Tangshan Xuyang 300000 tons styrene plant is scheduled to be put into operation on October 25, and Abel’s 250000 t styrene plant is scheduled to restart at the end of October. However, Shanghai Secco started to stop and repair 650000 tons styrene plant on November 15, which lasted 45 days; Jiangsu Shuangliang planned to stop and repair 210000 tons of styrene plant from November 4 to 5, which lasted 45 days. It is expected that domestic styrene production will be 968000 tons in October, almost unchanged in November at 963000 tons, and the start of construction in December has decreased slightly. However, due to the production days, the output will increase to close to 970000 tons, compared with 8859000 tons domestic supply in the last four months.
Thus, domestic supply is sufficient. According to the current ship report and foreign orders statistics, the supply of real goods in November is still scarce, but the US goods loaded in late October and November have more transactions, and the domestic styrene import volume in December may rebound.
Since this year, the downstream has maintained a high operating rate, especially EPS, which has increased by nearly 50% compared with previous years. On the one hand, the end demand is gradually recovered, on the other hand, styrene prices have been rapidly falling due to the epidemic situation, and the downstream price has not fallen much. Due to the large profit margin, downstream production will be increased and inventory preparation will be started. Since October, downstream supply is tight, especially ABS still has structural supply tension, which pushes up styrene price in reverse.
From the current news, in the EPS industry in the fourth quarter, some of Dongguan’s devices have negative plans; Zhuhai plans to put 300000 tons annually into operation at the end of October; Dalian plans to put into operation in November. In addition, Anhui Jiaxi styrene supporting EPS is expected to drive before the Spring Festival. In the fourth quarter, no new units were put into operation in PS industry, and the shutdown and maintenance of green safety devices led to a decrease of production of 20000-30000 tons compared with the third quarter. Driven by demand, the ABS industry is expected to start to rise again in the fourth quarter, with output expected to rise 18000 tons on a year basis. Overall, demand for styrene will continue to rise in the fourth quarter.
In general, the fundamentals are still positive, but the long-term price rise may weaken due to the increase in supply in December. Follow up attention to macro, crude oil, new capacity production and import.
| POLYVINYL ALCOHOL |