Core Insights - The article discusses the seasonal decline in pure benzene futures driven by downstream demand, with a notable decrease in operating rates expected in late September [1][2] Group 1: Downstream Demand and Production - From January to September, downstream demand for pure benzene increased by 8% year-on-year, with specific products like styrene, caprolactam, and phenol seeing demand growth of 17.3%, 7.6%, and 2% respectively [1] - Styrene production profits were satisfactory from May to July, but high operating rates led to increased supply, causing profits to decline significantly from August onwards, reaching historical lows [1] - Operating rates for styrene, caprolactam, and adipic acid have shown a month-on-month decline recently, indicating a potential further decrease in production rates due to weak terminal demand [1] Group 2: Supply and Import Dynamics - China is the largest consumer and importer of pure benzene globally, with an import dependency of about 20% [2] - From January to September, domestic pure benzene production rose by 5.7%, while imports surged by 40.5%, leading to a total supply increase of 10.4% [2] - The significant rise in imports is attributed to the near-total shipment of Korean pure benzene to China since last year's fourth quarter, with a total of 4.115 million tons imported from Korea in the first three quarters of this year [2] Group 3: Cost and Price Outlook - The long-term outlook for the crude oil market suggests a supply surplus, with recent geopolitical risks decreasing, which may lead to lower crude oil prices and weaker cost support for pure benzene [2] - The expectation is that while short-term crude oil prices may decline and terminal demand remains weak, medium to long-term factors such as high downstream operating rates and decreasing import volumes could support pure benzene prices, with futures contracts anticipated to experience a decline followed by a rise [2]