Report Summary 1. Industry Investment Rating No information provided. 2. Core View Since the end of 2019, styrene has experienced at least 4 bull - bear cycles. The reasons for the inflection points are cost - end changes and valuation repair [2]. 3. Summary by Directory First Turning Point (March 2020) - **Fundamentals**: Since its listing in 2019, styrene faced far - month supply - demand imbalance. New production capacity plans were numerous, and there was an expectation of port inventory accumulation at the end of the year. From January to March 2020, the commissioning of Hengli Petrochemical and Zhejiang Petrochemical increased supply significantly. Due to the Spring Festival off - season and delayed resumption of downstream factories caused by the epidemic, port inventory reached a historical high [3]. - **Macro - level**: From January to March 2020, the epidemic spread globally, economic activities shrank under lockdown measures, and crude oil prices declined. On March 9, OPEC + production - cut negotiations failed, and a price war between Saudi Arabia and Russia led to a sharp drop in crude oil prices. China's Q1 GDP in 2020 decreased by 6.77% year - on - year. The Chinese government and central bank implemented expansionary policies, and the Fed continuously cut interest rates and implemented quantitative easing [5]. - **Dominant Factor**: The cost - end changed significantly. Global central banks released liquidity, and the market expected crude oil prices to have bottomed out, so styrene costs "bottomed out." With a loose macro - environment and expansionary fiscal policies, styrene prices turned around at the end of March [9]. Second Turning Point (Mid - June 2022) - **Fundamentals**: In the first half of 2022, multiple plants were commissioned. Terminal demand was weak due to the Spring Festival and the epidemic, and the 3S开工率 gradually weakened. However, the high internal - external price difference led to a 32.29% year - on - year decrease in imports (about 28.25 tons) from January to June and a 91.98% increase in exports (about 20.18 tons), alleviating the weak domestic demand, and inventory showed a seasonal trend [10]. - **Macro - level**: In the first half of 2022, foreign countries resumed production, and oil demand rebounded. The Russia - Ukraine conflict in March and subsequent sanctions led to an expected contraction in crude oil supply and a rise in oil prices. The Fed entered an interest - rate hike cycle, and large - scale interest - rate hikes in May and June suppressed total demand and led to a decline in crude oil prices, causing the second inflection point [12]. - **Dominant Factor**: This was a cost - driven rise. Once the cost - end collapsed and there was no significant fundamental improvement, the inflection point arrived [14]. Third Turning Point (Late June 2023) - **Fundamentals**: Pure benzene inventory was high since 2023. Although port inventory decreased in the first half of the year, there was still a large amount in June, and downstream备货 was sufficient. By the end of June, the recovery of gasoline - blending and chemical demand led to a significant decrease in pure benzene inventory and styrene port inventory, driving up styrene prices [15][16]. - **Macro - level**: In the first half of 2023, although the epidemic lockdown was lifted, macro - economic indicators were poor, and the banking crisis in Europe and the US cast a shadow over the global economy, causing a decline in crude oil prices. Then, OPEC + announced large - scale production cuts, and with the arrival of the summer travel season, gasoline - blending demand increased, and crude oil prices rose [18]. - **Dominant Factor**: The turning point was supported by both fundamentals and a strengthening cost - end [19]. Fourth Turning Point (Early June 2024) - **Fundamentals**: In the first half of 2024, styrene's rise was cost - driven by the increase in pure benzene prices. The market consensus was that pure benzene was in short supply, and port inventory was at a historical low. The styrene - pure benzene price spread contracted continuously and was even negative in June, indicating that styrene was undervalued and pure benzene was overvalued. With the return of pure benzene supply, valuation repair led to a price decline [20]. - **Macro - level**: In the first half of 2024, China's nominal GDP was in a year - on - year contraction, indicating economic pressure. Crude oil prices first rose and then fell in the first half of the year and showed a significant unilateral decline in the second half [23]. - **Dominant Factor**: The inflection point was mainly due to the valuation repair of styrene and pure benzene and the weakening of the cost - end [25]. Summary - **Key Factors for Inflection Points**: For styrene, the turning of the cost - end (pure benzene price) is a key node, which can be affected by pure benzene's fundamentals or crude oil. The second type of inflection point is valuation repair. To find such inflection points, one needs to observe the disappearance or decline of factors causing over - or under - valuation [27]. - **Example of Valuation Repair Signal**: In 2024, the price inversion of pure benzene and styrene and the falsification of the overseas gasoline - blending logic for pure benzene signaled an inflection point [28].