2021 toluene price 'step by step' rise in China

In 2021, the domestic toluene market trend is still significantly affected by the fluctuations of international crude oil futures price.

Chart of toluene and crude oil prices in 2019-2021

In January, the oscillation of international crude oil futures formed a positive atmosphere supporting the external environment. At the same time, the production schedule of toluene unit of Quanzhou Petrochemical was seriously lower than expected, and the export sales of 80,000 tons originally planned failed to enter the market as scheduled. And this situation continued in February, toluene market control seriously, the end of the month delivery merchants forced to empty, further boost the price of toluene. In the advantageous situation dominated by favorable factors, toluene market remained warm in March, and the market negotiation was pushed to 6120 CNY/ton, reaching the highest point in the first half of the year.

From January to March, although the toluene market rose well, due to the impact of public health events, some small and medium-sized enterprises had a holiday in advance and started work late after the holiday. And gasoline demand continues to be tepid, so the toluene market lacks substantial transaction support. Despite a slight correction, WTI and Brent crude rose further in the second quarter and both stood above $70 / BBL. The cost side is strong, while the demand side continues to be weak, toluene market entered a stalemate consolidation in the second quarter.

In the second quarter, sinohua Quanzhou's export sales basically returned to normal, but due to the weak domestic demand, the import volume remained low for several months. As the price difference between pure benzene and toluene widened further, the rich profits of toluene disproportionation attracted downstream PX factories to purchase large orders, and the toluene market transaction ushered in the climax of the first half of the year. However, the large purchase of toluene by PX factories also caused panic in the xylene market, and the toluene market was difficult to maintain stability under the premise of large buyers selling xylene.

Toluene market after six months of silence, "Mid-Autumn festival and National Day" two downstream without apparent during the reaction, at the same time with double charged with electricity, energy plant stop making more than downstream terminal industry, demand shrank obviously, loss of market confidence in afternoon, most investors believe toluene market or will tame ending. However, during the National Day, the rise of crude oil led to the collective rise of liquefied bulk chemical products, downstream power restrictions brought by the negative was further offset, toluene broke through 6000 CNY/ton mark. Subsequently, crude oil - refined oil continued to rise, toluene industry pulled up a strong atmosphere, to meet the year's largest wave of rise. With the support of shandong refinery's active procurement, the main production enterprises actively raised the listing price, which boosted the toluene market transaction to more than 7,000 CNY/ton, a new high in the year.

Overall, toluene market trend in October is remarkable, becoming a "dark horse" trend this year, but only the gasoline industry actively driven, other industries trading volume did not significantly follow up, most of the rigid buying. Therefore, the rise of toluene behind the formation of potential negative, foreshadowing the subsequent fall.