Factor in the rising price of styrene

Trend chart of China's mainstream styrene market in 2021

Recently, domestic styrene prices performed strongly, and even shrugged off the global economic worries under the impact of the epidemic. They rose significantly this week. In this wave of market, what are the factors promoting the rise?

Although the price of styrene futures tracked crude oil's fall to a new low of 7,466 CNY/ton at the beginning of the week, it soon shook off the impact of crude oil and the weakening economic situation and continued to reduce positions throughout the week, closing at 8,090 CNY/ton on Friday night.

The post-fall shock of crude oil and the uncertain development of the novel coronavirus epidemic made the new low plate price attract the sentiment of short order profit closing. In addition, the OPEC+ meeting to be held over the weekend, short orders have the intention to avoid the market in advance, coupled with some changes in the rest of the styrene market, resulting in the week of EB01 contract reduced positions by nearly 80,000 lots, the price obviously rebound.

In the market's original expectations, there will be about 100,000 tons of tired stock level in December. However, due to the maintenance delay of some domestic devices, the sudden maintenance of some large devices and the delay of newly put into production devices, the state of styrene stock exhaustion in December has changed to a state of small inventory depletion, which has led to a certain change in the market mentality, and the bearish intention within the month is not so strong.

At the same time, export orders were clinched  

From late November to early December, the low domestic styrene price and the high foreign DOLLAR price led to the opening of domestic styrene export arbitrage window, especially the arbitrage between China and Europe.  Therefore, part of the styrene export negotiations have been attracted. Up to now, there are about 1000-13,000 tons of exports in December.  It has also shifted from an actively bearish market to a cautiously bearish one.  

In general, the spot market of styrene has not changed significantly for the time being, which is not enough to support such an obvious rise in the price of styrene. It is mainly due to the change of market mentality caused by some factors, which leads to the reduction of futures prices.