Cost aspect: In August, international crude oil was supported by the geopolitical situation and supply and demand fundamentals, and the overall operation was relatively strong. Upstream naphtha prices rose synchronously, continuously increasing the production cost of cracking to produce butadiene, and building a solid bottom support for the domestic butadiene market. At the same time, the overseas butadiene US dollar quotes have steadily increased, the cost of imported goods has significantly increased, the arbitrage window between domestic and foreign markets has closed, and the efforts to replenish overseas goods have weakened. Although the increase in butadiene prices this month far exceeded that of downstream rubber and plastic categories, and the profits of the industrial chain shifted upstream, downstream processing profits continued to be compressed. However, the high prices of upstream raw materials remained firm without a significant decline, and the favorable cost side continued throughout the month, effectively locking in the deep decline space of the butadiene market and providing important basic support for this round of price increases. As of August 27th, the settlement price of the October WTI crude oil futures contract in the United States was $83.53 per barrel, and the settlement price of the November Brent crude oil futures contract was $88.52 per barrel.
Supply side:
The overall tight supply of butadiene in the domestic market in August was the core factor driving the sharp rise in the market. Multiple mainstream butadiene cracking units in China have entered the maintenance cycle, with key units such as Yanshan, Yangzi, Sirbond, and Hainan Refining and Chemical undergoing phased shutdowns. The overall operating rate of the industry has significantly declined, and the circulation of domestic spot commodities has significantly contracted. In terms of imports, constrained by high prices from foreign markets, traders have a low willingness to import, resulting in a shortage of monthly arrivals at ports. Port inventories continue to deplete and remain at a low level. At the same time, some domestic goods are flowing into the export market, further compressing the domestic available spot quantity, and traders have low inventory and strong reluctance to sell and raise prices. Part of the equipment that underwent maintenance in the early stage of the month has been restarted and resumed production, resulting in a slight increase in market supply and easing of the tense situation. The increase in high priced goods has driven a slight correction in prices at the end of the month, temporarily reversing the unilateral upward trend.

Demand side:
This month, downstream demand for butadiene has shown significant structural differentiation, with limited overall rigid demand support and weak high price absorption. The rubber market has a significant off-season characteristic, which has formed rigid constraints on raw material demand. In terms of the rubber sector, the domestic natural rubber and synthetic rubber markets experienced overall fluctuations in August. Natural rubber was slightly strengthened due to the disturbance of rainfall in production areas and limited supply of raw materials, but the terminal transmission was weak; Shunding rubber and styrene butadiene rubber rely on the advantage of low-priced raw material substitution, and the industry maintains a medium to high level of production, forming a stable and essential demand support for butadiene. However, the tire terminal is in the traditional off-season of consumption, with slight fluctuations and overall low operating rates of all steel and semi steel tires in China. The inventory of finished products at the terminal continues to be high, and downstream car companies and auto parts processing factories have weak orders. The industry as a whole is mainly focused on rigid demand production, with no concentrated increase in production. At the same time, the significant price increase of butadiene within the month continues to compress the processing profits of rubber enterprises, putting pressure on the profits of synthetic rubber manufacturers. There is a strong resistance to high priced raw materials, and most enterprises insist on the mode of procurement and replenishment to avoid the risk of raw material price fluctuations. Except for the rubber category, chemical deep processing categories such as ABS and SBS have been in a long-term loss making state, and the increase in raw material prices has further squeezed the processing profits of enterprises. The industry has generally reduced its burden and production, and the demand for raw material procurement continues to shrink. After the price of butadiene surged within the month, the downstream industry’s wait-and-see sentiment quickly heated up, and market transactions significantly weakened, becoming the main negative factor restricting the sustained upward trend of the market and driving the price correction at the end of the month
Market forecast:
From the perspective of comprehensive supply and demand as well as cost fundamentals, the domestic butadiene market is likely to maintain a high and wide range of fluctuations in September. On the positive side, the cost support of upstream crude oil and naphtha remains stable. With the traditional “Golden Nine” consumption peak season starting, tire terminal demand is expected to gradually recover, and there is an expectation of a rebound in rubber category production. There may be marginal improvement in essential procurement; Negative factors are also prominent, and subsequent maintenance equipment will continue to resume production, gradually releasing market supply increments. Coupled with weak profits in downstream deep processing industries, enterprises lack the ability to accept high priced raw materials and are cautious about purchasing, making it difficult for demand to see significant volume increases. Overall, the butadiene market is supported by costs and low inventory in the early stage, with limited risk of a sharp decline. However, the upward space will be suppressed by both supply growth and weak demand, making it difficult to reproduce a unilateral surge trend. The focus will be on tracking the progress of equipment resumption, fluctuations in crude oil prices, downstream production and changes in essential procurement in the future.

This week, the price of pure benzene in the Shandong region fluctuated and rose. On Monday, the price of pure benzene was 7434.33 yuan/ton, and on Friday, it was 7494.33 yuan/ton, with a price increase of 0.81% during the week.
2、 Market analysis
Pure benzene: From the weekly trend, the price of pure benzene showed a trend of first rising and then falling, with a continuous upward trend from the beginning of the week to Wednesday and a significant decline on Thursday. During the week, Sinopec’s refineries in East China, South China, and Central China have raised the price of pure benzene twice in a row, with a cumulative increase of 350 yuan. The latest price of pure benzene is currently 7700 yuan/ton, which will be implemented on August 12th. The current stalemate in the US Iran game is causing market concerns to slow down. The support for pure benzene has decreased, and there is no obvious positive news to support it in the market. The focus of the pure benzene market is in a stalemate and consolidation.
3、 Future forecast
Crude oil futures: On August 13th, international crude oil futures closed down. The settlement price of the September WTI crude oil futures contract in the United States was $81.25 per barrel, a decrease of $2.02 or 2.4%. The settlement price of Brent crude oil futures for October was $87.07 per barrel, a decrease of $1.91 or 2.2%.
Foreign pure benzene: On August 13th, FOB Korea fell 2 to 943 US dollars/ton, and CFR China fell 1 to 956 US dollars/ton. FOB Rotterdam rose by 19 to 1152 US dollars per ton, FOB USG rose by 5 to 463 US cents per gallon.
Comprehensive forecast: The short-term pure benzene market is expected to show a range oscillation pattern. Observe the cost and demand side news. Continue to monitor the trends of crude oil and external markets, as well as the impact of changes in pure benzene and downstream equipment dynamics and demand on the price of pure benzene.

This month, the market price of pure benzene in Shandong region first rose and then fell, and overall the price has increased. On July 1st, the price was 6753.33 yuan/ton; On July 31st, the price was 7767.67 yuan/ton, an increase of 15.02% from the beginning of the month.
2、 Market analysis
Pure benzene: This month, the market price of pure benzene in Shandong region first rose and then fell, and overall the price has increased. At present, the situation between the United States and Iran is temporarily suspended, and international crude oil futures have closed down, leading to a decline in the pure benzene market. In terms of ports, imported goods are concentrated at the port, and the port accumulates inventory. Shandong’s local refining enterprises have offered discounts, and Sinopec’s refineries in East China, South China, and Central China have implemented a price of 7900 yuan/ton for pure benzene, which will be implemented on July 28th.
This month, Sinopec has raised the price of pure benzene by 1200 yuan/ton to 7900 yuan/ton.
3、 Future forecast
Crude oil futures: On July 30th, international crude oil futures closed down. The settlement price of the September WTI crude oil futures contract in the United States was $83.59 per barrel, a decrease of $0.87 or 1.0%. The settlement price of Brent crude oil futures for October was $86.88 per barrel, a decrease of $1.21 or 1.4%.
Foreign pure benzene: On July 30th, foreign pure benzene: FOB Korea rose 17 to 961 US dollars/ton, CFR China rose 17 to 979 US dollars/ton. FOB Rotterdam stable at $1233/ton, FOB USG stable at $433/gallon.
Overall forecast: The pure benzene market is expected to fluctuate within a certain range in the short term. We still need to wait and see more news on the cost and demand sides. Continue to monitor the trends of crude oil and external markets, as well as the impact of changes in pure benzene and downstream equipment dynamics and demand on the price of pure benzene.

This week, the aniline market continued to rise, with prices at 11125 yuan/ton on July 20th and 11525 yuan/ton on July 20th. The price increased by 3.6% during the week and 59.08% compared to the same period last year.
2、 Analysis and Review
During the week, the supply of aniline itself was tight, and the inventory of enterprises was controllable. The price of raw material pure benzene was boosted by crude oil, and the price was adjusted upwards. The production cost of aniline has increased, coupled with good market demand, resulting in multiple price increases for aniline. As of this Friday, the mainstream domestic price for aniline is 11500-11600 yuan/ton.
Cost wise: The stalemate between the US and Iran this week has not further escalated, with high oil prices fluctuating and providing support for pure benzene reserves. The inventory of pure benzene ports continues to decline and the absolute level is relatively low, and the load of the pure benzene industry remains at a low level for the year, resulting in a tight supply and demand pattern for pure benzene. Costs and supply and demand drive up the price of pure benzene.
3、 Future expectations
At present, the price of aniline has risen to a high level, and downstream demand has entered the market. With high costs, the shipment of aniline is relatively smooth. It is expected that the market for aniline will continue to operate at a high level in the short term, and we will closely monitor changes in costs and demand.

This week, the domestic mixed xylene market has shown a steady and slight upward trend, with high-level fluctuations and consolidation. The overall bullish atmosphere is mild and positive. During the cycle, the market relied on the dual support of strong crude oil costs and low on-site inventory, and the price center continued to shift upwards, with a stable and upward trend in the market.
Cost aspect: Crude oil tends to fluctuate strongly, with the overall center of gravity shifting upwards
The international crude oil trend in this cycle is relatively strong and volatile, with the overall focus steadily shifting upwards, providing sustained cost support for the aromatic hydrocarbon industry chain. The upstream naphtha prices have strengthened synchronously with crude oil, which has raised the production and processing costs of mixed xylene. At the same time, the overall volatility of the domestic aromatic hydrocarbon market and night market is relatively strong. Although there is no extreme unilateral market trend, the overall atmosphere of the industry is positive, and the market sentiment of supporting prices is generally strong. The continuous positive release on the cost side is the core driving factor for the steady rise in the price of mixed xylene this week, effectively consolidating the bottom of the market price and supporting the sustained strong operation of the market. As of July 16th, the settlement price of the August contract for WTI crude oil futures in the United States was $78.28 per barrel. The settlement price of Brent crude oil futures for September contract is $84.23 per barrel.
Supply side:
This week, the overall supply of mixed xylene in the domestic market showed a pattern of limited plant operation, low inventory, and tight supply. The spot market provided sufficient support, providing core fundamental support for the steady rise of xylene prices this week. From a production perspective, many refineries in China have not yet fully resumed full load operation of their pre maintenance facilities, coupled with short-term load adjustments for some facilities. As a result, the overall operating rate of the industry remains low, and the increase in on-site supply is insufficient. There is a shortage of imported xylene resources at the port, and external supplementary sources are weak. Port inventories continue to deplete and remain low, and the overall effective circulation of goods in the market is tightening. At the same time, mainstream consumer and circulation regions such as Shandong and East China have scarce spot resources, and overall inventory pressure on traders is extremely low. Against the backdrop of overall tight supply, refineries and traders have a strong mentality of raising prices and being reluctant to sell, resulting in generally firm quotes.
Demand side:
The overall performance of the demand side is stable and cautious in chasing higher prices, which has failed to drive the market to continue to strengthen significantly. The mainstream downstream industries of mixed xylene, such as coatings, solvents, resins, etc., have stable procurement needs, which can maintain market transactions and support steady price increases. But as prices continue to rise this week, downstream companies’ raw material procurement costs have increased, and their willingness to stockpile and replenish goods at high levels has significantly cooled down. Most of them adhere to the operational concept of on-demand procurement and small order follow-up, and market buying sentiment tends to be conservative. In addition, marginal demand for oil blending, fine chemicals, and other industries has remained stable with no significant incremental benefits released. The overall market trading activity is average, which restricts the upward potential of mixed xylene.
Market forecast:

In the short term, the domestic mixed xylene market is likely to continue its high range oscillation, stable and moderate operation trend. On the positive side, the support of international crude oil costs has not yet subsided, and the fundamentals of low domestic xylene inventories and tight supply continue. The bottom support of market prices is stable, and the probability of a significant decline is low. On the negative side, after the cumulative increase in prices in this cycle, there is currently no substantial positive stimulus in the market. The problem of weak downstream pursuit of high prices and light trading has become prominent, and there is insufficient action in the market. Overall, it is difficult to continue the unilateral upward trend of mixed xylene in the future, and the overall trend is mainly high-level consolidation with limited price fluctuations. In the future, it is necessary to focus on tracking the international crude oil trend, refinery operation and inventory changes, and downstream terminal demand procurement rhythm.

Demand side:
The off-season characteristics of downstream demand in June are obvious, and the overall rigid demand is weak, making it difficult to form effective support for the market. This month, the tire industry has entered a traditional off-season for consumption, with a decrease in terminal orders and a backlog of finished product inventory. Domestic tire companies have continued to decline in production, and the demand for Shunding rubber procurement has significantly decreased. Downstream factories are restocking at low prices according to demand, and the mentality of bargaining for goods is widespread. At the same time, mainstream downstream industries such as ABS and SBS have poor profitability, low production enthusiasm of enterprises, low industry operation, weak willingness to proactively replenish raw materials, and a quiet trading atmosphere on site. Only a small amount of latex industry maintains essential procurement, and the overall demand volume is limited, which cannot improve the weak market pattern and further exacerbates market pessimism.
Recently, the domestic market price of butadiene rubber has continued to decline. As of June 26, the price of butadiene rubber in the East China region was 12830 yuan/ton, a decrease of 1.38% from 13010 yuan/ton at the end of February; The closing price of the main contract for Shunding rubber futures fell to 11810 yuan/ton. We have completely reversed all the gains caused by the Middle East geopolitical conflict and returned to the benchmark range before the conflict broke out.

Market forecast:
Based on the overall market fundamentals in June, the weak pattern of the domestic butadiene market is unlikely to show significant improvement in the short term, and the market is likely to continue a weak and volatile trend. There is currently no significant expectation of cost boost, and the weak pattern of crude oil and raw material prices continues, making it difficult to provide support for spot prices; The overall supply of goods on the supply side is sufficient, and the pressure of accumulated inventory still exists, making it difficult to alleviate the short-term pressure on market shipments; The traditional off-season on the demand side continues, and downstream industries such as tires and ABS are unlikely to see a significant rebound in production. The boost to demand is limited, and the market’s wait-and-see and cautious attitude towards purchasing will still dominate trading. Overall, the short-term rebound momentum of the butadiene market is insufficient, and the market is mainly consolidating weakly. In the future, the focus will be on the trend of crude oil, the recovery of downstream production, and the fundamental changes brought about by changes in equipment maintenance.

This week, the market price of pure benzene in Shandong region has fallen. On Monday, the price of pure benzene was 7093.33 yuan/ton, and on Friday it was 6703.33 yuan/ton, with a 5.5% decrease in price during the week.
2、 Market analysis
Pure benzene: The pure benzene market in Shandong region fell this week. The latest quotation for pure benzene from Sinopec’s refineries in East China, South China, and Central China has been lowered by 400 yuan to 6700 yuan/ton, to be implemented on June 26th. The domestic market sentiment is pessimistic, and there is insufficient confidence in the pure benzene market. The local refining market in Shandong is weak, and we will continue to offer lower prices. There is currently no positive support, and the price of pure benzene in the East China market has fallen.
3、 Future forecast
Crude oil futures: On June 25th, international crude oil futures closed higher. The settlement price of the August WTI crude oil futures contract in the United States was $71.92 per barrel, an increase of $1.58 or 2.2%. The settlement price of Brent crude oil futures for September was $75.50 per barrel, an increase of $1.63 or 2.2%.
Foreign pure benzene: On June 25th, FOB Korea fell 21 to 805 US dollars/ton, and CFR China fell 22 to 825 US dollars/ton. FOB Rotterdam fell 73 to $1100 per ton, while FOB USG remained stable at 368 cents per gallon.
Overall expectation: The short-term pure benzene market is expected to remain stable and cautious in trading. Observe the cost and demand side news. Continue to monitor the trends of crude oil and external markets, as well as the impact of changes in pure benzene and downstream equipment dynamics and demand on the price of pure benzene.

From the supply side, the supply remained reasonably balanced this week. Previously, some units underwent maintenance, and production in northern regions slightly decreased. This week, enterprise units gradually recovered, ammonia production increased, and the market slowly increased, resulting in a slight increase in market supply. From the beginning of the week to the weekend, most companies did not adjust their prices, and some companies in Shandong lowered their prices by less than 100 yuan. The market showed a basic balance between supply and demand.
From the demand side perspective, downstream demand has shown lukewarm performance, with the operating rate of compound fertilizers still at a low level, especially in northern regions where agricultural demand is relatively weak, wheat harvest window period is empty, and downstream procurement is cooling down. Affected by weak demand and insufficient sustained demand in the later stage, according to the commodity analysis system, the weekly increase in urea was 0.42%. The urea range has adjusted, and the price is still at a relatively low level since April. In addition, the domestic industrial demand is weak, and agricultural demand is mainly purchased on demand with sporadic restocking. The improvement in demand is not significant, and the market’s wait-and-see mentality still dominates.
Market forecast:
Analysts believe that liquid ammonia may remain stagnant in the short term, with little change in equipment and a relatively abundant supply pattern. In addition, there are not many favorable factors on the demand side, limited replenishment of agricultural demand, on-demand procurement in the market, and industrial rigid demand as the main focus. There are currently no bright spots in the market, and the ammonia market may maintain an adjustment pattern.

Upstream: In May, the n-butane market in Shandong experienced a volatile downward trend due to geopolitical disturbances in the Middle East, limited imports to ports, and maintenance of some domestic facilities, resulting in overall tight resources; Internationally, Saudi Arabia’s CP butane remained at a high of $800 per ton in May.
Downstream: The unsaturated resin industry experienced sluggish production in May, with companies scheduling production according to orders. Terminal terminals such as building materials, bathroom products, and handicrafts have entered the traditional off-season, with light market transactions and downstream only requiring replenishment of inventory, without centralized replenishment demand, resulting in extremely low acceptance of high priced raw materials.
Business Society’s maleic anhydride product analyst believes that with the resumption of production of previous maleic anhydride maintenance facilities in June, market supply will gradually ease, and prices may continue to be under pressure due to inventory pressure from some companies. The operating rate of the downstream unsaturated resin industry is difficult to significantly increase in the short term, and enterprise procurement is still mainly based on essential needs, which has limited driving effect on the price of maleic anhydride. It is expected that the maleic anhydride market will have a downward trend in June.

Continuous rainfall in the province in mid month, coupled with the suspension of road construction, has dragged down the demand for essential goods, resulting in downward pressure on prices; In the latter half of the month, crude oil weakened and refineries slightly reduced their inventory, causing prices to hit the bottom again. However, low inventory strongly supported the bottom market, and at the end of the month, the range continued to fluctuate.
Supply side: Refineries are undergoing centralized maintenance, and the supply of goods continues to be tight. In May, the main asphalt refineries in Shandong underwent centralized maintenance, with the Landbridge unit continuously shut down and the Xinhai unit shut down, with only a few units resuming production. The regional asphalt operating rate remained low, with an average weekly operating rate of only 20.4%, a significant year-on-year decline. The profit of asphalt production is deeply inverted, and refineries have a strong willingness to actively control production and reduce output. Regional and social inventories continue to deplete, and spot circulation sources are tight, firmly holding the bottom of prices and limiting the potential for deep market declines.
On the demand side: Rainfall is dragging down construction, and terminal demand is weak. The demand in May is the core bearish factor that suppresses the price increase of asphalt. In mid to late May, there were multiple rounds of rainfall in Shandong, causing widespread suspension of outdoor road paving and maintenance projects, and causing a cliff like decline in terminal demand. The market transaction shows a trend of initially high and then low, with favorable weather in the first ten days and concentrated replenishment of engineering to support shipment; In the second half of the year, both traders and construction companies remained cautious, purchasing and selling as needed throughout the entire market, with no speculative hoarding demand. The demand for essential goods was unable to bear the driving force of price increases.
The fluctuation of crude oil drives short-term volatility, and the trend of futures and present is differentiated. International crude oil fluctuated widely in May, becoming the main cause of short-term fluctuations in asphalt prices. However, due to weak local fundamentals, the fluctuation of asphalt spot prices is far less than that of crude oil, resulting in weak cost transmission. The futures market closely follows the fluctuations of crude oil, with greater emotional fluctuations; However, Shandong’s spot market operates closely to local inventory and actual demand, with differentiated futures and spot trends, further stabilizing the volatile pattern of spot market.
In June, the rainfall in the province gradually ended, and road construction resumed in a concentrated manner. The terminal demand is expected to be repaired; At the same time, the refinery has no plans to resume production, and supply remains tight. It is expected that Shandong asphalt will experience strong fluctuations in June, with a slight upward shift in the price range. Overall, it is still difficult to shake off the volatile market, and the probability of a unilateral rise or fall is relatively low. In May, Shandong asphalt was affected by the dual effects of low supply bottoming out and weak demand topping out, coupled with the absence of unilateral crude oil prices, resulting in significant overall range fluctuations. The key focus of the subsequent market trend will be the recovery of essential demand after resuming work and the direction of international crude oil prices. These two factors will determine whether the market can break through the current volatile range in the future.