The Global Benzene Market is Witnessing a Sluggish Demand Leading To a Price Drop
- 11-Aug-2022 2:31 PM
- Journalist: Yage Kwon
Benzene prices are witnessing a significant drop in the global market due to weak purchasing from the consumer side. Poor terminal end demand and the reduction in the downstream derivative productions are the primary reasons that support the Benzene price drop. Additionally, the decrease in the factory price quote also influenced the Benzene values leading to a declining trend.
The random lockdowns in China have been affecting the Chinese economy. On top of that, the global recessionary concerns are impacting Benzene prices negatively. The import prices from South Korea were low because of the weak demand from China’s local market. The COVID-affected area in China was observing random lockdown and mass testing activities, which have been affecting the local market’s trade, resulting in the copious availability of the product in the domestic market. Furthermore, utilization of the existing product led to a drop in imports.
The German Benzene market slump is backed by the declining upstream Crude prices. Since the first week of August, upstream Crude prices have been below $100 per barrel, further pulling down the Benzene prices. Moreover, the German exports in June were at a record high, as the export rose by 4.5% compared to May. Hence, the demand from Netherlands and Belgium plummeted due to the healthy import in June, which led to sufficient product availability. As a result, the Benzene price in Germany dropped by $134/ tonne on 5th August.
The tumbling price trend of downstream derivative Cumene, Nitro Benzene, Acetone and others resulted in declining production of these products. Therefore, the feeble requirement from the downstream manufacturers ushered in the sluggish price of Benzene. Besides, the USA witnessed a plunge in the dollar of 0.2% on 1st August, further influencing the already worsening situation. In addition, the price quoted from the factory side is also reducing, and the traders follow the same trend.
According to the ChemAnalyst analysis, the Benzene market will likely decline globally in the coming weeks. The demand from the consumer end might remain weak with poor production. The tension between China and Taiwan might also lead to certain sanctions, resulting in product stockpiling. Furthermore, the raw material prices may drop consistently.