China's benzene market remains soft in the wake of perceptions of loose supply/demand fundamentals. Benzene facilities that were undergoing maintenance are restarting and supply is perceived to be ample. On the other hand, as several derivative facilities recently started turnaround, buying interest in benzene receded. However, since some new derivative facilities are scheduled to start up going forward, fresh demand for benzene is anticipated to emerge. The market is unlikely to decline sharply.

For major derivative styrene monomer (SM), operation rates of production facilities are recently declining. Further, arrivals of imported cargoes are also delayed and inventories are falling. In addition, with production costs high, SM markers are not willing to reduce their offers to sell. But as new facilities are scheduled to start up going forward, supply might grow. Under such circumstances, the market is expected to be firm in the short run but would be on the decrease in the long run.

In the phenol (PH) market, Shenghong Petrochemical would restart its PH facility this week. Further, Jilin Petrochemical is reported to have already injected feedstocks into its new PH facility. Meanwhile, demand is still scarce. In this situation, supply/demand seems to be slack.

The benzene market going forward would likely be affected by crude oil prices and the operation status of derivative facilities.