In the second half of July, the domestic PS market showed a positive trend, with most grades experiencing significant increases in spot prices. As of July 24th, the benchmark price of PS is 10000 yuan/ton, with a price level increase of 11.73% compared to the beginning of the month.
Fundamental analysis
Cost factors: Recently, there have been fluctuations in the ceasefire talks between the United States and Iran in the Middle East, increasing shipping risks in the Strait of Hormuz, and market concerns about international crude oil supply, leading to a rapid return of geopolitical premiums in oil prices. The rise in cost provides upward momentum for petroleum and pure benzene, which in turn boosts the price of styrene. However, the supply and demand expectations are still relatively loose, and the upward space for prices may be limited. It is expected that the styrene market will fluctuate weakly in the short term.
Supply and demand level: Recently, the domestic PS industry has experienced significant stability and small fluctuations. The domestic operating rate has been consistently low for a long time, and some facilities are still undergoing scheduled maintenance, resulting in an overall domestic load of around 50%. The inventory location is controllable, but the supply in some areas is tight. At the same time, with the addition of some inventory replenishment orders, the manufacturer has a strong willingness to raise prices, and the merchant is trying to overcharge. But currently, it is the traditional off-season market, and downstream product factories such as electrical appliances and packaging are digesting slowly. In addition, the high temperature weather continues, and terminal enterprises still have expectations of reduced production, resulting in low operating rates and weak demand for goods in the market. Currently, PS is still in a phase of weak supply and demand.
Future forecast
The domestic PS market rose strongly in the second half of July. The production load of the aggregation plant is maintained at a low level, and consumer demand is at a low season level. Analysts believe that remote raw material crude oil has surged, and upstream raw materials in the industry chain have generally surged due to its boost. The cost value has quickly rebounded, and PS spot prices are operating relatively strongly under the guidance of favorable costs. However, downstream demand for goods remains resistant to high priced sources, and it is expected that the PS market may enter a stalemate in the short term.