Market Analysis - Monthly Report - October, 2020 - Benzoic Acid

Overview of the current market situation

Europe and the United States sub-toluenegold market prices generally rose, a large gap in the increase, mainly affectedby the overall upward impact of international crude oil futures. Asian toluenemarket first weak then rise, the overall upward. Asian toluene markets wereunder selling pressure as international oil prices fell earlier, but demand inIndia was strong and prices soared; local prices in China improved every day asprices exceeded recent lows. Asia's toluene market has risen further as aresult of the daily rise in crude oil, but weak fundamentals have barelychanged since early week. Then the Asian toluene market was basically stablebecause Indian buyers expanded their demand for raw materials, while far Eastsuppliers continued to manage year-end quantities. South Korea's Yeosu, anaphtha steam cracker that supplies toluene with an unexpected shutdown, isexpected to put pressure on the Asian naphtha market, which rose again.European toluene market prices rebounded strongly, rising significantly. At thebeginning of the week, affected by the weak trend of international crude oilfutures, and Europe's large economies introduced more stringent blockademeasures, affecting the downstream gasoline market demand. Sources expect thatdemand for transportation fuel will again be restricted because of liquidityrestrictions and relatively stable prices. Zhouzhong European toluene marketrecovery Zhongyu Information Weekly series resurrected, pushing the premium tothe highest level since early July. Crude oil prices were boosted by news thatthe Organization of Petroleum Exporting Countries (OPEC) would extendproduction cuts until next year, while spot prices of toluene rose as upstreamenergy prices rose.

In October, benzoic acid market prices anddemand recovered smoothly, downstream demand remained stable.

Next MarketForecast

At present, theprice of benzoic acid has two main aspects:

1、Raw materialprice: the price of raw material fluctuates smoothly and has little effect onthe cost of downstream benzoic acid.

2、Epidemicimpact: China's domestic demand is stable, but exports are affected by foreigndownstream enterprises, not as expected.

3、Factoryshutdown: due to the violation of safety regulations, Tianjin Dongda closeddown, short-term recovery of production is not likely, so the market supply hasa longer vacancy.

Benzoic acidsummed up: in October, the benzoic acid market was hot and cold, and the exportdemand was not as expected, but due to the shutdown of the factory and the parkingand maintenance of other factories, The price of benzoic acid and relatedproducts will fluctuate greatly in November.