According to the Commodity Market Analysis System of Business Society, from September 1 to September 8, 2023, the weekly auction price of crude benzene showed a significant increase, with 6788.75 yuan/ton last weekend and 7388.75 yuan/ton this weekend, with a weekly increase of 8.84%.

In terms of crude oil: OPEC+, an oil producing country, is rumored to have extended production cuts. The market expects an additional 1 million barrels of production reduction from Saudi Arabia to continue until December, while Russia’s crude oil production reduction will continue until December. Supply tightening is expected to continue to ferment and boost the oil market; In addition, the weakening of the US dollar has led to a rebound in oil market valuations and the potential impact of storms in the US Gulf on energy supply, which is a positive factor supporting international oil prices. On September 7th, international crude oil futures closed lower. The settlement price of the main contract for WTI crude oil futures in the United States was $86.87 per barrel, a decrease of $0.67 or 0.8%. The settlement price of the main contract for Brent crude oil futures was $89.92 per barrel, a decrease of $0.68 or 0.8%. Long profit taking, coupled with market vigilance against weak demand expectations, has suppressed oil prices.

The factory price of Sinopec pure benzene has been raised three times in this cycle, with a cumulative increase of 600 yuan/ton during the week. Currently, it is priced at 8350 yuan/ton.

The K-bar chart of commodity prices uses the concept of a price trend K-line to reflect weekly or monthly price fluctuations in the form of a bar chart. Investors can buy and sell investments based on the changes in the K-bar chart. Red indicates an increase; Green indicates a decline; The height of the K-bar represents the range of fluctuations. The weekly K-bar chart of pure benzene shows that the pure benzene market has seen a positive trend in recent times. After ten consecutive weeks of decline, it has continued to rise for six consecutive weeks, slightly falling for three consecutive weeks, and rising by another 2.01% this week.

From the perspective of the industrial chain, the macro performance of this week was good, with domestic commodity prices rising more or falling less, and the market atmosphere was more active. Crude oil continued to rise during the week, with styrene strengthening on the market. The supply of pure benzene itself was slightly tight, and downstream markets were actively entering the market. Under the influence of multiple positive factors, the pure benzene market has rapidly risen this week, while the hydrogenation benzene market has been significantly affected. The factory price in the main production area has increased to 8400 yuan/ton, with a cumulative increase of 550 yuan/ton during the week.

This week, the pure benzene industry continued to operate strongly, and the hydrogenation benzene market followed the trend of growth. Driven by the industrial chain, the auction price of crude benzene this week has significantly increased, with the Shandong region executing 7450 yuan/ton, with an increase of 650 yuan/ton. In the Shanxi region, 7400-7470 yuan/ton will be implemented, with an increase of 700-750 yuan/ton. In terms of supply, coking enterprises have recently started operating at a relatively high level, with a significant increase in overall operating rates. The supply of crude benzene during the week was relatively loose compared to the previous period. The recent changes in demand have not been significant, but overall demand is still acceptable. Affected by the good expectations of the Golden Nine Silver Ten and pre holiday stocking, market procurement is relatively active. In the future, there are obvious positive factors for the market, but as market prices rise to high levels, there will be further upward resistance. After the weekend crude oil correction, the hydrogenation benzene market will slightly decline. It is expected that the high consolidation trend of the pure benzene industry chain in the future will be the main focus, with a focus on downstream pre holiday stocking plans.

1、 Price trend

According to the Commodity Market Analysis System of Business Society, the average market price of chlorinated paraffin 52 in China on September 1st was 5350 yuan/ton. On September 7th, the average market price of chlorinated paraffin 52 in China was 5350 yuan/ton, and the price of chlorinated paraffin 52 remained stable this week.

2、 Market analysis

The market price of chlorinated paraffin remained stable this week. This week, the price of raw material liquid wax has increased, while the price of raw material liquid chlorine has decreased. The cost side is mixed. Downstream on-demand procurement results in light market transactions and a strong wait-and-see atmosphere in the industry. The manufacturer delivers at a stable price and overall delivery performance is average. As of September 7th, the factory quotation for chlorinated paraffin 52 in Anhui region is about 5700 yuan/ton, while the factory quotation for chlorinated paraffin 52 in Shandong region is about 5000-5350 yuan/ton, which is a national standard.

In terms of raw material liquid wax, the price of liquid wax continued to rise this week, with a stronger trend. Liquid wax fluctuated with the crude oil market. In terms of raw material liquid chlorine, the price of liquid chlorine continued to decline this week, leading to a weak market situation and a poor trading atmosphere in the market.

3、 Future Market Forecast

Chlorinated paraffin analysts from Business Society believe that the prices of raw materials have risen and fallen recently, and the neutralization cost is relatively stable. Terminal demand is weak, and market transactions are weak. It is expected that in the short term, the price of chlorinated paraffin will mainly be adjusted and operated in a narrow range.

Since the end of August, the overall commodity market situation has shown an upward trend (see Figure 1). The futures sector, including soda ash, glass, synthetic rubber, and styrene, has experienced a surge in prices. Driven by the expected reduction in international crude oil production, the energy and chemical sector has overall improved. The impact of high oil prices on inflation may increase the expectation of the Federal Reserve raising interest rates. On September 6th, after the news surfaced, the sustainability of current high oil prices and the upward space narrowed. Where will precious metal prices go in the future?

Expected realization of crude oil production reduction

Saudi Arabia and Russia are fulfilling their production reduction commitments. Saudi Arabia’s voluntary production reduction measures of 1 million barrels per day will continue until September (the production reduction plan is evaluated monthly to determine whether to continue), and Russia’s crude oil exports will be reduced by 500000 barrels per day in August, with subsequent reductions of 300000 barrels per day. The OPEC organization maintains its previous production reduction policy of 3.66 million barrels per day, which is constrained by the production reduction of major oil producing countries, and the crude oil supply side continues to tighten. Global refinery profits are at a five-year high. The main risks on the supply side lie in Iran’s expectation of increasing production and the United States considering relaxing sanctions against Venezuela.

At present, the expected reduction in crude oil production has been fulfilled, and the news is positive with early overdraft, which has been reflected in the recent oil price, and the upward space in the later stage has narrowed. Currently, oil prices are in the high price range.

In the early stage, the correlation between precious metals and crude oil trends is strong. After the second half of 2022, precious metal prices have bottomed out and stabilized, and the magnitude of macro factors affecting them has begun to show differentiation. The trend of precious metals and crude oil began to converge in late March, but after mid April, the trend began to diverge again. Mainly due to the increased impact of risk aversion on the rise of precious metal prices. Recently, crude oil prices have rebounded, and precious metal prices have also followed suit.

Comparison of precious metal gold and silver price trends in the past year

In 2022, the rise and fall trends of precious metal gold and silver have converged, but the decline in silver was deeper from April to August, and the recent recovery has been more significant. In December, silver continued its strong trend last month, and gold began to consolidate at high levels. In 2023, precious metal gold and silver have consolidated at high levels, with a slight decline in February. Since March, precious metal prices have started to rise. Silver prices began to decline in May, while gold remained relatively strong. In June, gold prices reached a high level and silver prices began to rise.

Future Market Forecast

At present, the price of precious metals has been fluctuating in the high range after hitting a 10-year high in the early stage. In the early stage, we expected that under the high inflation and high interest rate hikes, the pace of overseas economic recession may lead to a relatively strong sense of risk aversion, which is currently reflected in prices. Some central banks around the world have increased their holdings of gold reserves, which has also provided some support for gold prices.

However, in the near future, it is still necessary to focus on watching the Fed’s interest rate hike expectations. The next two weeks will see the release of US CPI data and the Federal Reserve’s interest rate resolution. Currently, inflation in the United States is still too high, and most officials do not support immediate policy easing. High oil prices have an impact on inflation. If inflation unexpectedly rises, further tightening policies will be supported, which may make the Federal Reserve inclined to raise interest rates. This will suppress the price of precious metals. In the short term, the upward space for precious metal prices has narrowed, and the probability of narrow range fluctuations has increased.

According to the Commodity Market Analysis System of Business Society, the hydrogen peroxide market continued to rise in early September. On September 5th, the average market price of hydrogen peroxide was 1500 yuan/ton, with a daily increase of over 4%.

Terminal demand improving, hydrogen peroxide market rising

The demand for terminal caprolactam and papermaking industries has increased, and the operating rate of domestic hydrogen peroxide manufacturers is relatively low. The market supply is tightening, and the market is constantly rising. The mainstream quotation has risen to 1500 yuan/ton, an increase of 25% compared to early August. Prediction: Supply is tightening, the peak consumption season is approaching, and the hydrogen peroxide market is still expected to rise in the future.

Business Society Hydrogen Peroxide Analysts believe that there is still room for improvement in the future hydrogen peroxide market due to the increase in terminal rigid demand.

Product name: isobutyraldehyde

Latest price (September 4th): 8933.33 yuan/ton

On September 4th, the domestic market price of isobutyraldehyde significantly increased, with a price increase of 700 yuan/ton or 8.50% compared to September 1st, and a year-on-year increase of 14.04%. The price of raw material propylene has significantly increased, leading to increased cost support. The downstream market for new pentanediol has stabilized at a high level, and downstream customers have a good enthusiasm for purchasing isobutyraldehyde. Duo Zhong Li is good, and the market price of isobutyraldehyde has significantly increased.

In the future, it is expected that the domestic market price of isobutyraldehyde may fluctuate and rise, with consolidation being the main focus. The average market price is around 9200 yuan/ton.

List of ethylene glycol prices

According to data from Business News Agency, on September 1st, the average price of domestic oil to ethylene glycol was 4136.67 yuan/ton, an increase of 1.89% compared to the beginning of the month. The prices in various regions are as follows:

The price range for spot goods executed by mainstream manufacturers in East China is between 3950-4200 yuan/ton; The spot price of ethylene glycol in the South China market is 4050 yuan/ton, while the price range for mainstream manufacturers in Central China is 3950 yuan/ton; The spot price for mainstream manufacturers in North China is 4350 yuan/ton.

The factory price of coal based ethylene glycol is low, with a current price range of 3550-3700 yuan/ton.

On August 31st, the CIF price of ethylene glycol in China was 466 US dollars/ton; The CIF Southeast Asia price is 481 US dollars per ton.

Ethylene glycol fundamentals

The port inventory is high and in a continuous accumulation state; On the supply side, there is an expectation of an increase in production due to the restart of equipment in the early stage; On the demand side, the sustainability of polyester’s high start-up rate needs further observation. The supply and demand fundamentals of ethylene glycol are relatively weak, but the cost support has recently strengthened. The upward trend in crude oil prices and the synchronous increase in coking coal prices have formed strong cost support for ethylene glycol. The recent game point is whether the emotional benefits brought by cost factors can suppress the reality of weak fundamentals.

According to the Commodity Market Analysis System of the Business Society, the domestic TDI price trend was fluctuating in August. At the beginning of the month, the average TDI market price was 18100 yuan/ton, and at the end of the month, the price was 18500 yuan/ton. Within the month, it increased by 400 yuan/ton, an overall increase of 2.21%.

In August, the TDI market experienced a high level of volatility and overall performance was relatively strong. At the beginning of the month, TDI prices rose significantly, mainly due to the dense supply of positive news from suppliers, and strong demand from holders. Overseas BASF in South Korea and Mitsui TDI devices in Japan shut down, foreign supply tightened, and domestic orders improved. At the same time, news of a device load reduction by a large factory in North China was released, and on-site spot supply was tight, supporting a significant increase in TDI prices; By the 17th, TDI prices fluctuated within the range, and at this stage, spot prices continued to be tight. Downstream demand followed up, and trading in the trade market was moderate. The market mentality was mostly wait-and-see; In the later stage, demand weakens, downstream follow-up is limited, and the trade market mentality is entangled. Some holders have reported downward, and the focus of market transactions continues to decline slightly.

The upstream toluene market rose narrowly, with a price of 8090 yuan/ton at the end of the month, an increase of 230 yuan/ton or 2.93% compared to the price of 7860 yuan/ton at the beginning of the month. On the cost side, the price of naphtha fluctuates and increases, and the rise in raw material prices is good for toluene support. The international crude oil price fluctuates at a high level, and toluene cost support still exists. At the same time, driven by the increase in exports, the toluene market is operating at a high level.

According to the TDI data analyst from the Business Society, the supplier’s stock situation is tight, and the factory’s attitude towards the market is mainly positive. Downstream customers have a resistance towards high prices, and their enthusiasm for entering the market is average. Market trading is light, and there is insufficient support for positive market conditions on the market. Under the supply and demand game, it is expected that the TDI market will remain stagnant in the future, and specific attention will be paid to downstream follow-up.