Styrene business struggles on the edge of profit and loss line

Since March, the styrene market has been boosted by the upward trend in oil prices and has maintained a strong operating pattern.

cost pressure

"Although the average price of styrene in March came out of this year's high, but due to cost pressure, we theoretically lost nearly 600 yuan per ton of product

Affected by the general strong operation of oil prices recently, the markets of ethylene and pure benzene, the two major raw materials of styrene, have performed strongly, and their prices have both reached new highs during the year

"For non-integrated units that rely on external procurement of raw benzene and ethylene, the market for styrene products cannot keep up with rising costs, thus encroaching on profit margins

"Although the price of styrene is rising, most styrene producers are struggling on the break-even line, especially non-integrated device companies complaining

Ease of supply expectations

Regarding whether it can get rid of the loss-making state in the later stage, the industry generally holds a relatively pessimistic attitude based on the expected release of new production capacity this year

According to statistics, in 2021, China's new styrene production capacity will be 2.

　　"Although many styrene plants started to shut down for maintenance in the second half of the first quarter due to losses, most of them only lasted until mid-to-late April

　　From the perspective of the whole year, the supply side of styrene may show a loose state, which is difficult to give strong support to the market

　　The main force downstream is weakening

　　"Due to the spread of the domestic epidemic, the three main downstream products of styrene, expandable polystyrene (EPS), polystyrene (PS), and acrylonitrile-butadiene-styrene terpolymer (ABS), have been blocked from circulation.

　　In terms of EPS, the current price of common materials in East China is 11,050 yuan, the inventory of domestic sample companies has maintained a periodical high of 26,300 tons, and the operating rate has dropped to 38.

　　In terms of PS, the current quotation in Yuyao is 10,600 yuan, and the finished product inventory of sample enterprises has increased again to 97,800 tons since March, and the operating rate has dropped to 65.

　　In terms of ABS, the current quotation of 757K in East China is 15,100 yuan, and the finished product inventory of sample enterprises has maintained a stable level of 190,000 tons after the slight destocking in February, and the operating rate has dropped slightly to 87.

　　Overall, the inflection point of the domestic epidemic has not yet occurred, and it is difficult for transportation and logistics to recover in a short time.