According to statistics from Zhuochuang Information, the export volume of styrene in April has reached 200,000 tons, a 300% increase compared to the expected 50,000 tons in early March. The higher-than-expected increase in exports has, on the one hand, boosted market sentiment, and on the other hand, offset part of the reduction in China demand.

Driven by the cost increase triggered by the military conflicts among the US, Israel, and Iran and the improvement in fundamental expectations, the China styrene price in China rose significantly in March and then remained at a high level. As of March 31, the average price in the Jiangsu market reached 9,939 yuan per ton, a month-on-month increase of 29.27%. After the high-level fluctuations in the first ten days of April, looking ahead to the styrene market in the middle and late April, the geopolitical situation in the Middle East remains the core variable. Coupled with the strong fundamental support, the overall price of styrene is more likely to rise than fall. However, it is necessary to be vigilant against the risk of oil price fluctuations caused by the repeated news during the negotiation process.

Since March, China's styrene prices have widened and fluctuated at a high level, with the main driving logic being the increase in costs and the improvement in fundamental expectations. The direct impact of the US-Iran war on the oil price has led to a wide range of increase, and the subsequent geopolitical issues have led to a decrease in global refining supply, which has, on the one hand, driven the strong increase in ethylene prices, lifting the cost of styrene; on the other hand, the reduction in overseas supply is greater than the reduction in China's market, and the increase in styrene exports has exceeded expectations, and it is expected that the export volume in March will reach 80,000-90,000 tons.

In addition, the market is concerned that the supply of styrene in the Chinese market in April may decrease, and the sentiment also provides support for the high price of styrene. From the overall increase in the industrial chain, as of the close of March 31, the average price of Brent crude oil increased by 43.58% compared to the previous month, pure benzene increased by 33.26% compared to the previous month, ethylene increased by 57.18% compared to the previous month, and the closing average price of styrene in the Jiangsu market was 9939 RMB/ton, with a month-on-month increase of 29.27%.

Looking at the situation in April, the cost-driven factors dominated by the Middle East geopolitical situation are still the main factors affecting the rise and fall of styrene prices, and the fundamental situation of styrene is strengthening, which supports the price to rise easily but not to fall.

Specifically, on the cost side, during the Qingming Festival holiday, due to the escalation of the war in the Middle East, the crude oil price has been fluctuating at a high level, maintaining a relatively strong trend. On April 8th, with the active mediation of Pakistan, the United States and Iran reached a two - week temporary cease - fire agreement. The geopolitical premium was quickly given back. The price of US crude oil dropped from a high of nearly $120 per barrel all the way to approach $90 per barrel, and then rebounded slightly. After the US - Iran cease - fire agreement was reached, Israel continued to attack Lebanon, and market sentiment was volatile. We need to continue to pay attention to the changes in the situation. If a definite peace agreement is not reached within two weeks, then the crude oil price still has the risk of fluctuations; otherwise, with the progress of the peace agreement and the real and thorough resolution of the Middle East issue, the crude oil price will drop from $90 per barrel all the way to below $70 per barrel.

Looking further at the fundamental situation of styrene, the increase in exports exceeded expectations, providing a strong support to the market.

From the supply side, the increase in the number of restart devices and the postponement of multiple device maintenance plans have led to a reduction in styrene supply or a supply that is not as expected. As of March 31, the average profit of non-integrated styrene devices was -179 RMB/ton, a decrease of 215.62% compared to February. Although the theoretical profit has become negative, the cash flow profit still maintained a profit; the average profit of PO/SM devices was 1116 RMB/ton, an increase of 17.76% compared to February; the profit of integrated devices was 933 RMB/ton, an increase of 21.56% compared to February. Driven by high profits, more devices were restarted in March, and they will contribute to the supply increase in April. And multiple devices that were scheduled for maintenance in March and April have postponed their maintenance plans to varying degrees. In April, the production of styrene is expected to be 1.43% higher than the initial expectation of 1.533.4 million tons in early March, at 1.5553 million tons.

On the demand side, China demand has decreased while exports have exceeded expectations, providing a relatively strong support for the market. The total demand in April is expected to be 1.5669 million tons, a 0.76% increase compared to March. Among this, China demand is expected to be 1.3669 million tons, a 7.34% decrease compared to March. This is mainly due to the wide increase in raw material prices since the geopolitical conflict in March, and the recovery of terminal consumption has been slow after the Spring Festival. The cost transfer of the main downstream three S is blocked, and the industry's production has been gradually declining since the end of March. It is expected that the production will still be constrained by the loss pressure in April, and there will be no improvement in production. On the other hand, regarding foreign demand, the supply gap of styrene in directions such as Japan, South Korea, India, and Europe has increased due to the blockage of shipping in the Strait of Hormuz. The negotiation in the export market in March and April is active. According to the statistics of Zhongchuang Information, the transaction volume of styrene exports in April has reached 200,000 tons, a 300% increase compared to the initial expectation of 50,000 tons in early March. The unexpected increase in exports has not only boosted market sentiment but also offset part of the decrease in China demand.

In summary, in the first ten days of April, the international oil price rose first and then fell, and styrene fluctuated accordingly. Looking at the middle and late April, the issue of shipping in the Strait still has fluctuations. The cost - end support for styrene remains relatively strong. Based on the stockpiling for export orders in the styrene fundamentals, the liquidity of port supplies is restricted, and there is still an expectation of inventory reduction in the later market, which also provides relatively strong support for the price. Overall, it is expected that the price of styrene in the middle and late April is still more likely to rise than fall, with an operating range of 9,500 - 11,500 RMB/ton. The downward risk factor is the breakdown of crude oil prices, while the upward risk factors include the continued escalation of geopolitical issues and the continued increase in exports exceeding expectations.

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