Benzene reports are published weekly by ICIS in Asia, Europe and the US, with contract and spot price assessments, market news and analysis.
Benzene forecast reports for all three regions are published on a monthly basis, covering the market up to one year ahead. Monthly forecast reports are also available for the Styrene market.
Updated to Q2 2019
Increased supply from the start-up of a new facility in China in April was countered by the shutdown of a reformer in Taiwan following a pipeline explosion. Another explosion at a petrochemical site in Malaysia, also in April, quelled chances of the start up of a new benzene unit in the second quarter. Overall then, the supply of the chemical in Asia was little changed in the quarter.
Demand in China was lacklustre amid the escalation of the US-China trade war. Sentiment was cautious with Chinese users relying mostly on local cargoes with appetite for import staying lacklustre. However, the open arbitrage window to the US, and from time to time Europe, spurred demand for Asia cargoes. Some buying interest from Taiwan and Japan for spot lots was also seen in the second quarter, which helped support demand for benzene.
The European benzene market started the quarter tight for prompt delivery on an unplanned outage, but the majority of Q2 2019 was well supplied amid planned maintenance along the supply chain. The quarter ended with a pull on prompt as volume was exported to the US. Imports increased by 44% year on year in April, confirming the market’s position as a net importer, while exports plummeted to a mere 27 tonnes. The majority of imports came from India, Turkey and Israel.
Demand from the key derivative styrene decreased in the second quarter, partly because of planned outages for the market and its downstream sectors but also as macroeconomic malaise and geo-political uncertainty reduced consumer confidence along the supply chain.
Supply lengthened amid increased refinery operating rates as refiners prepared for the spring and summer gasoline seasons. Supply also increased on a steady influx of imports from Asia amid new and upcoming capacity and growing oversupply in China. The growing supply overhang in China prompted increased exports from Asia, regardless of arbitrage opportunities. Supply briefly tightened at the tail-end of the quarter but quickly normalised with the arrival of delayed imports.
Demand increased in the second quarter on increased demand from the downstream styrene sector after two of the major styrene producers completed turnarounds and ramped up production. AmSty completed its styrene turnaround late in the first quarter and LyondellBasell early in the second quarter, increasing demand for benzene for styrene production. Demand for imports was also healthy amid lower operating rates for on-purpose benzene units given disadvantageous economics for toluene and toluene disproportionation units.
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Benzene is used primarily as a raw material in the synthesis of styrene (polystyrene plastics and synthetic rubber).
Benzene is a colourless, refractive liquid with a characteristic aromatic odour. Its vapour is toxic and highly flammable. In cold weather, benzene solidifies to a white crystalline mass. It is slightly soluble in water, miscible with ethyl alcohol, ether, acetone, carbon tetrachloride, carbon disulphide, and glacial acetic acid (GAA).
Benzene is the largest volume aromatic petrochemical used to produce a number of petrochemical intermediates.
Ethylbenzene (EB) is the largest chemical outlet for benzene and nearly all is consumed in the production of styrene.
The second largest outlet for benzene is cumene which is nearly all consumed in phenol production with acetone formed as a coproduct.
The third largest outlet for benzene is cyclohexane (CX) which finds its way primarily into the nylon chain via caprolactam and adipic acid.
The fourth main derivative of benzene is nitrobenzene, which can be used to make aniline.
Benzene is used to make a number of other chemical intermediates such as alkylbenzene used in detergents, maleic anhydride(unsaturated polyester resins) and chlorobenzenes (engineering polymers).
The main sources of benzene are from the steam cracking or catalytic reforming of liquid petroleum feedstocks, primarily naphtha, where the benzene is recovered from the aromatics stream. Other processes are hydrodealkylation (HDA) of toluene and toluene disproportionation (TDP).
ICIS Benzene Price Index
US Benzene Prices were assessed at $2.75 – 2.83 / gal FOB (free on board) in mid June 2015. Downstream US styrene outages have depressed benzene prices whilst at the same time fuel blending demand has raised Prices for Toluene to $2.95-3.08/gal. This change has almost eliminated the spread between the two aromatics in the US for the first half of 2015.
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