For the Quarter Ending September 2024
North America
In Q3 2024, the North American Benzene market experienced a persistent decline in prices, reflecting a challenging pricing environment. Significant factors influencing this downturn include weakening demand from key sectors like styrene monomer and phenol, alongside supply chain disruptions and fluctuating naphtha prices.
These dynamics have contributed to a 24% decrease in prices compared to the same quarter last year. In the USA, which has witnessed the most substantial price changes, the market has seen a negative trend with a 10% decrease from the previous quarter in 2024. Hurricanes significantly affected the petroleum markets by disrupting crude oil production and refining operations. Crude oil prices were also supported by growing optimism about potential interest rate cuts by the US Federal Reserve. Lower lending rates were expected to stimulate consumption, thereby increasing oil demand in the world's largest economy.
Offshore oil and natural gas production units faced substantial risks from hurricanes and tropical storms, necessitating emergency protocols to evacuate nonessential personnel and temporarily cease production. The Dow Chemicals, Royal Dutch remained shut temporarily due to the impact of Hurricane accompanying the dim demand outlook. Overall, the pricing environment in North America for Benzene in Q3 2024 has been characterized by a notable decrease, reflecting ongoing challenges and uncertainties in the industry.
APAC
In Q3 2024, the Benzene pricing landscape in the APAC region remained stable, reflecting a consistent market sentiment. Various factors influenced market prices, including stable demand from downstream sectors, moderate supply levels, and fluctuations in crude oil prices. These elements played a crucial role in shaping Benzene prices and maintaining a balanced pricing environment throughout the quarter. This consistent pricing trend underscores the resilience and equilibrium in the Benzene market in the APAC region during Q3 2024. Freight rate indices had been offering mixed signals, but the most recent data showed a consistent decline in rates as shipping companies and shippers finalized annual contracts for the transpacific route. Additionally, demand for benzene from sectors like aromatics and phenol remained stable and uninterrupted, supported by ample inventories to meet market needs. In other parts of Asia, downstream demand had yet to hit a turning point, with most benzene buyers remaining cautious about securing forward spot positions. Although firm European benzene prices had sparked some interest from Chinese exporters, arbitrage opportunities were limited by logistical difficulties associated with long-haul shipments.
Europe
The third quarter of 2024 for Benzene pricing in the Europe region has been characterized by a significant downtrend in prices. This decline can be attributed to various factors such as weak demand, decreased production costs, global geopolitical tensions, and ample local inventories influencing naphtha prices, which in turn impact benzene production costs. The oversupply of naphtha in the European market has led to a sharp drop in prices, creating challenges for producers in managing fluctuating raw material costs and squeezed profit margins. The reduced demand from downstream sectors like styrene and other aromatics has further pressured benzene prices in the region. In the Netherlands, the market has experienced the most significant price changes in the region. The quarter saw a -17 percent decrease from the same period last year, with a -14 percent decrease from the previous quarter i.e., Q2 in 2024. The price comparison between the first and second half of the quarter showed a -7 percentage change.
MEA
In Q3 2024, the Benzene pricing scenario in the Middle East and Africa region witnessed mixed signals with a significant decline in the last month of Q3 of 2024, with Saudi Arabia experiencing the most notable price changes. Various factors contributed to this downward trend, including a decrease in demand from end-use manufacturing units, reduced import costs from Asian exporting countries, and a supply crunch in the market. These elements collectively influenced the market dynamics, leading to a decrease in prices. Seasonal fluctuations and geopolitical tensions further added to the negative sentiments impacting Benzene prices across the region. The demand outlook for benzene from end-use manufacturing units had remained relatively soft but positive. However, supply chain disruptions and a drop in export volumes from the international market resulted in a decline. Union leaders had warned that Indian government ports could face major disruptions if negotiations to prevent an indefinite dockworker strike failed. This warning came as India was working to improve port efficiency to handle rising export volumes amidst diversified supply chains. In Saudi Arabia specifically, the pricing environment has been characterized by instability, with a 12% decrease compared to the same quarter last year and a 7% decline from the previous quarter in 2024.
South America
Throughout Q3 2024, the South American region experienced a notable downward trend in Benzene prices, with Brazil showcasing the most significant price changes. Various factors have influenced this market shift, including production costs, demand levels, and supply chain disruptions. The weakening demand from major consumers like styrene monomer, phenol, and cumene has added pressure to the pricing dynamics. Additionally, fluctuations in naphtha prices, a key feedstock for Benzene production, have directly impacted pricing trends. The overall trend in Q3 reflects a 14% decrease compared to the same quarter last year, with a 9% decline from the previous quarter in 2024. Fluctuations in naphtha prices, a key feedstock for benzene production, had directly impacted pricing trends. At the same time, OPEC's diminishing influence on global crude markets had shifted attention to Brazilian economic indicators, heightening concerns about market volatility. In August, troubling economic data emerged, including rising unemployment claims, a weakened manufacturing index, and a disappointing payroll report. Despite initial fears about the economy, investors believed that while a slowdown was occurring, an immediate collapse was unlikely. Instead, the economy appeared to be in a late-stage business cycle, marked by a gradual deceleration rather than a sharp downturn, offering some stability amid ongoing market fluctuations.
For the Quarter Ending June 2024
North America
The second quarter of 2024 has seen a drastic decline in benzene prices in North America, driven by a confluence of factors that have shaped the market dynamics. A significant factor influencing market prices has been the fluctuating crude oil prices, which directly impact naphtha production, a crucial feedstock for benzene. The impact of severe weather, particularly hurricanes disrupting petroleum markets, has further exacerbated the situation, affecting crude oil production and refining operations. Additionally, the global freight industry has experienced a pronounced surge in freight rates, with rates for routes from Asia to North America increasing by over 40%, contributing to higher logistics costs and influencing benzene prices. The demand from end-use manufacturing sectors such as styrene, phenol, and other aromatics had declined, insufficient to counterbalance the downward pressure.
Seasonality played a role, with the market reacting to the typical Q2 slowdown in demand. The correlation between crude oil prices and benzene remained strong, with naphtha production costs influencing the overall pricing environment. Compared to the same quarter last year, benzene prices have decreased by 11%, reflecting a significant year-over-year decline. The percentage change from the previous quarter in 2024 stands at 3%, indicating a moderate decrease. When comparing the first and second halves of Q2, prices declined, further emphasizing the bearish market sentiment.
The overall pricing environment for benzene in North America has been negative, with the latest quarter-ending price recorded at USD 1178/MT FOB Louisiana in the USA. This consistent decrease underscores the challenges faced by the benzene market during Q2 2024, driven primarily by external factors and fluctuating demand from key manufacturing sectors.
APAC
In the second quarter of 2024, Benzene prices in the APAC showcased mixed sentiments, driven predominantly by several interrelated factors. The primary contributor to this downward spiral was the continuous decline in naphtha prices, a key feedstock in Benzene production. This reduction in input costs significantly compressed the final production costs of Benzene. Additionally, the stable and consistent demand outlook from end-use manufacturing units, such as those producing styrene, phenol, and other aromatics, exacerbated the price variations. Tight container availability in the Asian market further restricted the supply chain efficacy, constraining the market dynamics for Benzene retailers and pushing prices downward. Furthermore, the overall economic sentiment in the region, marked by uncertainties in trade patterns and high inventory levels, maintained a bearish undertone throughout the quarter. Focusing exclusively on South Korea, which experienced the most considerable price adjustments, the quarter revealed marked trends and seasonality effects. Seasonal factors, including reduced industrial activity and weaker downstream demand, contributed to this trend. The price comparison between the first and second halves of the quarter variations as the prices declined in the first half and rebounded in the second half of Q2. The latest quarter-ending price of Benzene in South Korea stood at USD 1058 per MT FOB Seoul, underscoring the negative pricing environment that dominated the period.
Europe
In Q2 2024, the benzene market in Europe experienced a notable decline in prices, driven by multiple influential factors. The quarter was characterized by a downturn in demand from key downstream sectors such as styrene and other aromatics, coupled with a significant drop in naphtha prices, exacerbated by global geopolitical tensions and ample local stockpiles. This oversupply of naphtha led to plummeting benzene production costs. Additionally, weakened economic activity in the Eurozone reflected in declining industrial output and reduced demand for petrochemical derivatives, further pressured benzene prices downward. Analysts also noted a bearish trend influenced by OPEC+ decisions to extend production cuts, contributing to ample inventories and a subdued demand outlook. Focusing on Germany, which witnessed the most significant price changes, the overall trend for benzene was consistently negative. Seasonality played a role as well, with typically lower industrial activity during this period exacerbating the price decline. Compared to the same quarter last year, benzene prices plummeted by 33%, indicating a substantial year-over-year decrease. From the previous quarter in 2024, prices fell by 8%, showcasing a steady downward momentum. Within the quarter itself, the price comparison between the first and second half revealed a further decline of 2%. Concluding the quarter, the price of benzene FOB Hamburg stood at USD 1211 per metric ton, underscoring the negative pricing environment that dominated Q2 2024 for the German benzene market.
MEA
The second quarter of 2024 witnessed a significant surge in benzene prices within the Middle East and Africa (MEA) region, driven by a confluence of market dynamics. A pivotal factor influencing this upward trend was the sustained decline in naphtha prices, which did not translate into cheaper benzene due to heightened demand from downstream sectors such as styrene and phenol. Additionally, the global shipping crisis, marked by tight container availability and escalating freight rates from Asia, further exacerbated supply constraints. Seasonal maintenance and production cuts by major oil producers also contributed to an increase in operational costs, thereby elevating benzene prices. Focusing on Saudi Arabia, the region experienced the most pronounced price changes. The overall trend for Q2 2024 was decidedly bullish, with benzene prices escalating compared to the same quarter the previous year. This was attributed to a tighter supply of medium and heavy grades, anticipated due to oilfield maintenance in Saudi Arabia, production cuts by OPEC+, and increased domestic consumption in several Middle Eastern producing countries. Concluding the quarter, benzene prices in Saudi Arabia reached USD 1135 per MT, CFR Al Jubail. This marked a positive pricing environment, driven by robust demand dynamics and supply chain challenges, suggesting a continued bullish outlook for the foreseeable future.
South America
Benzene prices in the Brazilian market slipped in the second quarter of 2024 amidst steady demand and sufficient inventories to meet both domestic and international market needs. The demand for benzene from the phenol, acetone, and cumene sectors remained moderate in the domestic market. Industry experts suggested that refiners had limited ability to reduce prices due to recent increases in international oil prices, driven by Middle East conflicts and a strengthening U.S. economy. Petrobras, in determining its pricing policy, took into account not only international rates but also internal production costs. The Brazilian market exhibited a better demand outlook as one of the major styrene (a key end-user of benzene) players, Innova, resumed operations, consequently increasing demand and the number of inquiries in the domestic market. Moreover, the Asian market experienced planned plant shutdowns for maintenance purposes, leading to reduced demand amidst the stable and moderate demand outlook from the international market.
For the Quarter Ending March 2024
North America
The first quarter of 2024 witnessed a bullish trend in the Benzene price dynamics amidst the continuous incline in the production cost and the striking demand outlook for the commodity from the end-use manufacturing units. The demand for key aromatic including Benzene improved during the quarter and same can be seen in the prices. The increased cost of delivery and production, coupled with a slight rise in crude oil prices, continued the recent upward trend.
This followed reports from the industry indicating a larger-than-expected decrease in U.S. crude oil stocks during the quarter. However, the gains were limited due to a larger-than-anticipated increase in inventories of petroleum products. This has led to concerns about heightened tensions in the conflict in the Red Seas region and increased pressure on the supply chain.
Additionally, there was a surge in rates for liquid chemical tankers and containers traveling from East Asia and China to the US this week, attributed to disruptions at the Panama and Suez canals, highlighting the logistical challenges in the current situation. Moreover, the demand for Benzene from styrene and other monomers remained on the higher end throughout the quarter leading to a price hike in Q1. The quarter-ending price for Benzene in the US market was USD 1233 per MT, FOB Louisiana.
APAC
In the first quarter of 2024, Benzene prices in the APAC region increased overall, with South Korea experiencing the most significant price changes. This upward trend was attributed to several factors, including increased demand from downstream industries, higher production costs, and fluctuating delivery expenses. The percentage change in Benzene prices from the same quarter last year was 13%, indicating a significant increase.
Additionally, there was a sharp increase in prices from the previous quarter in 2024, reflecting the ongoing upward trajectory. The price comparison between the first and second half of the quarter showed a 12% increase, further highlighting the bullish pricing environment. In South Korea, Benzene prices were particularly affected, with a consistent increase throughout the quarter. This was due to strong demand from domestic and international markets, as well as higher delivery costs at domestic ports.
The South Korean market experienced a bullish sentiment, with a moderate to high supply of Benzene and increased demand from downstream industries such as styrene and other aromatics. The quarter-ending price for Benzene in South Korea was USD 1050 per metric ton, reflecting the overall positive pricing environment. The increased demand and fluctuating production costs contributed to the upward trend in Benzene prices in the APAC region for Q1 2024.
Europe
The first quarter of 2024 saw an increase in Benzene prices in the European region. Market prices were influenced by several factors during this period. Demand from downstream industries such as styrene, cumene, and pharmaceuticals remained steady, leading to consistent but subdued demand for Benzene. Concerns over supply constraints and extended transit times also caused price fluctuations. Geopolitical tensions and trade disruptions in the Red Sea impacted trade routes, resulting in delays and higher freight costs.
In the Netherlands market, Benzene prices saw the most significant changes. Overall, there was an upward trend in prices, with a significant percentage change from the same quarter last year. As the quarter ended, the latest price for Benzene FOB Rotterdam in the Netherlands was USD 1350 per metric ton. The pricing environment for Benzene in Europe during the first quarter of 2024 was positive, with increasing prices reflecting the demand-supply dynamics and geopolitical factors impacting the market.
MEA
In the first quarter of 2024, Benzene prices in the Middle East and Africa (MEA) region experienced a consistent upward trend, indicating a positive pricing environment. Several factors influenced market prices during this quarter. Firstly, there was stable and moderate demand for Benzene from various end-use industries such as styrene, cumene, and solvents. This steady demand contributed to price stability and increases in the region. Additionally, geopolitical tensions in the Red Sea led to increased delivery costs at domestic ports, further impacting Benzene prices. The supply chain also faced challenges, with tight supply availability and increased crude oil and naphtha prices. These factors contributed to the upward trajectory of Benzene prices in the MEA region. Saudi Arabia, the largest producer in the region, saw the most significant price changes in Benzene prices. The country experienced a 4% increase in Benzene prices compared to the same quarter last year. In Q1 2024, there was a 1% increase in prices compared to the previous quarter. Notably, there was a significant 9% price increase between the first and second half of the quarter. The quarter-ending price for Benzene in Saudi Arabia was USD 1005 per metric ton CFR Al Jubail, reflecting the overall positive pricing trend in the country. Overall, the Benzene pricing environment in the MEA region for Q1 2024 was characterized by increasing prices, driven by stable demand, geopolitical tensions, and supply chain challenges.
For the Quarter Ending December 2023
North America
In the fourth quarter of 2023, the North American Benzene market experienced a decline with moderate supply and demand. Major container ports in the United States had already reached their projected peak in import cargo volume for the year, resulting in moderate demand for Benzene from downstream sectors such as styrene and cumene. Global difficulties in the petrochemical industry influenced trade dynamics for various chemical products.
The fourth quarter of 2023 was expected to see improved demand off-takes from the downstream sector, and the domestic chemical sectors were anticipated to exhibit a better demand outlook. Benzene retailers demonstrated destocking behaviour towards the end of Q4. In the USA, Benzene prices declined by 9% compared to the previous quarter due to subdued demand from downstream sectors like styrene and aromatics.
The forthcoming inflation report from the Labor Department is expected to show that businesses kept overall prices stable for the second consecutive month. The Department of Energy (DoE) has stated that there was no alteration in the crude oil inventories held within the Strategic Petroleum Reserve (SPR). The latest price of Benzene FOB Louisiana in the USA for the past quarter was USD 1002/MT.
APAC
In Q4 2023, the benzene market in the APAC region experienced a bearish situation with a weak demand outlook and overall production costs influenced by declining naphtha and crude oil prices. The decrease in benzene volume imported from South Korea to China was less severe compared to the previous year, reflecting weak demand in China accompanied by rising import prices. The South Korean benzene market faced subdued demand from downstream industries, leading to a continued decline in domestic prices. The quarter's conclusion indicated potential lower production rates and a subdued demand outlook for styrene, cumene, and other aromatics, with no observed plant shutdowns during the period. Buyers showed hesitancy owing to unfavourable buying signals, anticipating heightened supply in Asia due to congestion in the Panama Canal and increased run rates in toluene disproportionation (TDP) units. Both domestic and international buyers faced difficulty in accepting prevailing offer levels, given that downstream customers were cutting order quantities. The percentage change from Q3 to Q4 2023 was 18%, and the price percentage comparison between the first and second half of the quarter in South Korea was -5%. The latest price of Benzene FOB Seoul in South Korea in Q4 2023 was USD 866/MT.
Europe
The fourth quarter of 2023 was bearish for the benzene market in Europe due to sluggish demand and excess supply. The overall outlook remained negative despite moderate supply. One of the primary reasons for the decline in demand was the slow pace in the manufacturing of intermediate goods, energy, and durable and non-durable consumer goods. The downstream sectors such as styrene and cumene also displayed a weak demand perspective, which further influenced benzene prices throughout the quarter. The crude oil production cut imposed by Saudi Arabia on the Asian market also impacted the production cost. The percentage change in price from the last year's same quarter was -8%, while the change from the previous quarter was 2%. Market observers noted a persistent decrease in benzene bid-offers throughout the week. In the past month, Aramco, the state-owned energy group from Saudi Arabia, lowered the January OSP differentials for all its crude grades bound for Europe, the Mediterranean, and the United States. European benzene prices witnessed a decline as a result of fluctuations in upstream factors.
MEA
In Q4 2023, the benzene market in the MEA region underwent a bearish trend characterized by weak demand, recent increases in port imports, and ongoing price declines. The negative industry outlook for the future of the benzene market was influenced by the quarter-end, resulting in lower production rates and a subdued demand outlook for styrene, cumene, and other aromatics. The decline in production was linked to a sluggish pace in manufacturing both durable and non-durable consumer goods, with a notable decrease in the production of intermediate goods and energy. Saudi Arabia, the world's leading benzene exporter, experienced a stable market with moderate supply and demand. The country predominantly imported benzene from Asian countries, primarily India and South Korea. The conclusion of the quarter hinted at the possibility of improved price dynamics in Q1 2024, with better demand from the downstream sector. Saudi Arabia's recent decision to cut crude production and supply might influence the overall market dynamics of benzene in the domestic market. The latest price for the selected country in the past quarter was USD 901/MT of Benzene CFR Al Jubail in Saudi Arabia.
South America
The Benzene market in South America experienced stability with moderate supply and low to moderate demand from downstream businesses throughout the fourth quarter of 2023. The market remained bearish due to weak performance in the retail sector and minimal demand from end-use manufacturing units. The expected incline in the prices of upstream naphtha impacted the production cost of Benzene. Furthermore, the Israel and Palestine conflict continued to impact the upstream prices of crude oil and naphtha, leading to lower interest from buyers. The quarter ended on a positive note due to an initial expansion in Brazil's manufacturing sector, driven by an increase in sales and production in September. Brazil faced challenges in meeting its domestic demand for oil, leading to fluctuations in Benzene prices in the country. The demand outlook for Benzene from major end-use manufacturing units remained soft, yet moderate demand from the acetone market with limited supply levelled the overall price dynamics of Benzene. The quarter end may lead to lower production rates and a low demand outlook from styrene, cumene, and other aromatics. The latest price of Benzene FOB Santos in Brazil in the current quarter is USD 840/MT.
