China's Pure Benzene Market in May 2025: V-Shaped Recovery Followed by Supply-Driven Weakness

Market Recap: A V-Shaped Pattern
During May 2025, China’s domestic pure benzene market displayed a V-shaped trend. Prices started weak due to oversupply and poor downstream margins, then rallied mid-month on trade optimism and stronger derivative demand, before softening again by month-end. Sinopec’s East China settlement price for April 26 to May 25 averaged 5,928 RMB/ton, while spot prices on May 27 stood at 5,900 RMB/ton, down 1.35% from late April.

Early May: Demand Collapse and Sentiment Low Point
At the beginning of May, only styrene and phenol sectors remained marginally profitable. Other downstream sectors such as caprolactam, aniline, and adipic acid struggled with low operating rates and inventory pressure. Pure benzene prices bottomed out at 5,600 RMB/ton amid widespread bearish sentiment.

Mid-May: Trade Talks Fuel Rally
Positive developments in China–U.S. trade negotiations triggered a demand-led recovery. Prices surged to a monthly high of 6,300 RMB/ton. Improved utilization rates in downstream caprolactam and aniline facilities boosted confidence, and a bullish short-covering trend drove further gains.

Late May: Fundamentals Return, Prices Soften
By late May, bulk chemicals including styrene corrected due to narrowing processing margins. Some styrene producers resumed operations earlier than expected, pressuring margins and reducing benzene consumption. Despite this, benzene prices showed resilience, supported by a tightening benzene–styrene spread and speculative restocking.

Supply Overview: Output and Inventory Trends
Petroleum benzene output: Approx. 1.79 million tons, operating rate around 80%
Hydrogenated benzene output: 270,000 tons, operating rate 50.4%
East China port inventory: Rose from 120,000 tons to 143,000 tons
May imports: Around 142,000 tons arrived; 119,000 tons delivered; net gain of 23,000 tons

Downstream Sector Performance
Styrene: 70.30% (up 2.32% month-on-month)
Caprolactam: 83.60% (up 2.09%)
Phenol/Ketone: 82.99% (up 4.49%)
Aniline: 72.61% (up 1.83%)
Adipic acid: 56.34% (up 2.64%)

International Market Activity
From May 1 to 20, South Korea exported 111,744 tons of pure benzene, including 105,740 tons to mainland China.
FOB Korea: increased from $667.5 to $708.5 per ton
CFR China: increased from $689.5 to $726.5 per ton
FOB U.S. Gulf: increased from $249.45 to $263.45 per gallon
FOB Rotterdam: increased from $624.5 to $682.5 per ton

Cost and Profitability Trends
Reforming units: average theoretical margin -$37/ton
Disproportionation units: margin +$9.6/ton
MX–PX short process: remained profitable

Outlook for June 2025
Though domestic turnarounds will reduce supply slightly (e.g., Huizhou, Shenghong), high import volumes over 500,000 tons will maintain oversupply pressure. Downstream sectors like styrene and CPL show relatively strong run rates but are unlikely to offset the supply influx. Crude oil prices remain volatile, influenced by geopolitical risks and OPEC+ decisions.

Price Forecast:
East China benzene: 5,600–6,000 RMB/ton
Shandong petroleum benzene: 5,500–6,050 RMB/ton

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