In China, the benzene market has been firm due to tight supply while the styrene monomer (SM) market has been soft along with a supply glut in the past few years. As a result, the price gap between benzene and SM remained narrow until June.

From July, as import of benzene cargoes has been increasing and supply tightness eased, the market was on a downtrend. Meanwhile, the SM market was firm on the back of macro factors and low inventories. Under such circumstances, the price gap between benzene and SM widens to around Yuan 1,000/mt at present.

From September onward, demand for benzene is forecast to grow as derivative facilities are restarting after turnaround and new derivative facilities are scheduled to start up. On the other hand, the SM market is anticipated to be firm owing to low inventories. In this situation, the price gap between benzene and SM is predicted to stay wide going forward.