Price trend
According to data from SunSirs’bulk list, domestic toluene prices continued to rise this week. On January 31, the price of toluene was 4,250 yuan/ton; this Sunday (February 7) the price was 4,737.5 yuan/ton, an increase of 487.5 yuan/ton from last week, an increase of 11.47%.
Analysis review
During the week, Sinopec’s toluene price increased by 450-500 RMB/ton. This week, the spot supply of toluene market had decreased, the supply of toluene was expected to be tightened, and the price rose stably. However, as the Chinese New Year approached, the downstream was leaving the market one after another, demand weakened, and actual transactions were limited. In terms of external disks, toluene in the external disk continued to rise this week. As of February 5, the price of toluene imported in South Korea was 615 US dollars/ton, which was an increase of 62 US dollars/ton during the week compared to January 29, an increase of 11.21%; the price of imported toluene in East China was 631.5 US dollars/ton, a month-on-month increase of 57 US dollars/ton, or 9.92%, compared to January 29.
With regard to crude oil, energy demand was expected to increase due to severe weather in the United States. In February, OPEC+ implemented production cuts, the global crude oil supply is expected to tighten, the market is optimistic about the demand outlook, and Brent crude oil rose close to 60 US dollars per barrel. From January 29th, Brent crude oil rose by 4.64 US dollars/barrel, or 8.42%, this week; WTI crude oil rose by 4.6 US dollars/barrel, or 8.87%, this week.
Downstream: In terms of TDI, the price of TDI in East China rose slightly this week, with domestically produced goods at 12,833.33 RMB/ton, an increase of 0.52% from last week and an increase of 9.69% from the same period last year. As the Spring Festival approached, dealers were on holiday one after another, downstream buying was weak, and the market began to enter a closed state. Affected by the supply side's support market operation, the TDI market was operating in a consolidation.
In the PX market, the domestic ex-factory price of paraxylene rose slightly this week, with the average weekend price at 5,300 yuan/ton, down 15.87% year-on-year. This week, the domestic PX operating rate was around 60%. As of the end of the weekend, the Asian market closing price of PX was 718-720 US dollars/ton FOB Korea and 736-738 US dollars/ton CFR China. This week, external disk PX prices rose, international crude oil prices rose, and domestic PX market prices rose.
Market outlook
Toluene analysts of SunSirs believe: Look at the supply cost side, the implementation of OPEC+ production cuts, the total number of US oil rigs, and weekly EIA and API inventory data. Second, look at the demand side, the impact of the global epidemic on crude oil demand, the recovery of the industrial chain, the economic and trade situation in Europe and the US, and the progress of the fiscal stimulus plan. Third, look at the geopolitical situation in the Middle East and China and the United States, the progress of the new crown vaccine, the dollar index and the linkage of the stock market.
Downstream terminals have ceased operations and logistics have decreased, and the toluene market is expected to enter a period of stable price consolidation. Continue to pay attention to the downstream procurement situation and the impact of crude oil and external disks on toluene prices.
