According to the Commodity Market Analysis System of Shengyi Society, the overall toluene market has been declining recently (8.2-8.9). On August 5th, the benchmark price of toluene was 7380 yuan/ton, and on August 9th, the benchmark price of toluene was 7270 yuan/ton, a decrease of 1.49% during the period. This cycle, the toluene market continued to operate weakly, with market prices fluctuating downward. The decline in crude oil prices during the week has dragged down market sentiment, and the overall market atmosphere is bearish. The overall demand is weak, and the enthusiasm for purchasing in the gasoline blending industry is low. The enthusiasm for downstream market entry is also low, coupled with the weakening macro situation, which has led to a strong market atmosphere. As of August 9th, the mainstream quotation range in East China is between 7220-7250 yuan/ton, with a cumulative price reduction of 70-100 yuan/ton compared to last week.
On the cost side: During this cycle, the crude oil market has declined. On the one hand, the OPEC+production reduction of 2.2 million barrels per day will be implemented until the end of September, but from October onwards, depending on market conditions, production may gradually increase, which is bearish for the crude oil market. On the other hand, the poor non farm payroll data and rising unemployment rate released by the United States in July, coupled with poor global economic data, have intensified market concerns about the demand outlook and increased negative pressure on the psychological level, leading to a decline in the crude oil market trend. Overall, the crude oil market has significantly declined during the cycle, with a negative rate of change in crude oil. As of August 9th, international crude oil futures have risen. The settlement price of the main contract for WTI crude oil futures in the United States was $76.84 per barrel, an increase of $0.65 or 0.9%. The settlement price of the main Brent crude oil futures contract was $79.66 per barrel, an increase of $0.50 or 0.6%.
Supply side: Sinopec’s toluene quotation has been partially reduced this week, with slight differences in the extent of reduction across regions, and the reduction is relatively small. At present, the enterprise is operating normally, the production of equipment is stable, the products are mostly for personal use, and the production and sales are stable. Among them, the East China Company quoted 7150 yuan/ton, the North China Company quoted 7350 yuan/ton, the South China Company quoted 7200-7250 yuan/ton, and the Central China Company quoted 7200 yuan/ton.
Demand side: The external market for xylene continues to decline, and the demand support for toluene is relatively weak
On August 12th, Sinopec Sales Company temporarily stabilized the price of xylene, with the current execution price being 8500 yuan/ton. This price is implemented in East China, North China, Central China, and South China. Yangzi Petrochemical, Zhenhai Petrochemical and other facilities are operating stably and selling normally. As of August 8th, CFR China’s closing price was 983 US dollars/ton, a decrease of 22 US dollars/ton from last week.
On Friday (August 9th), the Asian toluene market was closed due to a public holiday. The closing price for August 8th was $884-886 USD/ton FOB Korea; The closing price of CFR China in September was 872-874 US dollars per ton.
Market forecast: The recent trend of crude oil on the cost side is weak, with limited support for the toluene market. Affected by the macro atmosphere, the overall atmosphere of the toluene market has been weak recently, with low market operation intentions and limited trading. Although the price is at a lower level this year and some regions have some intention to replenish inventory, the market atmosphere is still acceptable. But overall, downstream demand is still weak, with insufficient demand support. Overall, there are still negative factors in the toluene market, and there is a strong supply-demand game mentality. It is expected that the short-term trend will be dominated by narrow fluctuations. Focus on downstream replenishment in the future.
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