Introduction: PX spot tension has intensified recently. Let’s briefly analyze the reasons and impacts.
Analysis of causes of PX tension:
Because the price difference between MX and PX is too low, the price of toluene and pure benzene is too low, and the supply of heavy naphtha is tight, domestic PX factories have reduced or increased shutdown plans. Unexpected losses in domestic supply, and foreign construction is difficult to recover in the short term. This round of PX supply is direct cause of tension.
Figure 1 Comparison of price trends between PX and MX
It can be seen from the figure that starting from June, the prices of MX and PX have been upside down. Currently, the production of PX by MX is still unprofitable. Reason analysis:
1. A large factory in Northeast China is undergoing atmospheric and vacuum maintenance, which has put pressure on MX prices. For disproportionation maintenance next month, MX still needs to be supplemented;
2. A PX factory in Northeast China took out MX in the early stage, but after the PX was turned on, the MX was mainly used for its own use;
3. The refined oil market drives MX.
Figure 2 Comparison of price trends of pure benzene and toluene
Due to the weak downstream market, the price of pure benzene continues to decrease, the disproportionation efficiency of toluene is low, and the disproportionation start-up of PX plant decreases.
Starting from June, especially in July, Fujia Dahua, a factory in Northeast China, Tianjin Petrochemical, Qingdao Lidong, Luoyang Petrochemical, Fujian United, Sinochem Quanzhou, Huizhou Refining and Chemical, and Hainan Refining and Chemical have successively lowered their operating hours by 5-35 point.
Looking at September: Sinopec system maintenance, load reduction and PX shortage elimination at a large plant in Zhejiang, the new PX loss in September is expected to be 136,000 tons (not taking into account the current reduced load and the disproportionation of a large plant in Northeast China next month losses caused by maintenance). Recently, there have been many delays in PX shipments and reductions in long-term contracts. Considering the tight supply side, it is expected that PXN will continue to strengthen.