Report Industry Investment Rating - The overall investment rating is neutral [4] Core Viewpoints - For pure benzene, last week's supply increased with a new Jingbo plant producing products and no new device maintenance. August's supply is expected to continue rising. Imports are expected to decline in August as the US - Asia arbitrage window closed and the China - South Korea price difference is weak. In the short - term, demand may rise or remain stable due to the commissioning of Jingbo's styrene plant and high operating rates of caprolactam and aniline. In the long - run, demand may weaken due to weak downstream profits. Inventory is expected to decrease, and the current valuation is low [4]. - For styrene, last week's supply decreased. There were no new maintenance devices, but overall supply was high in August and may tighten in September due to multiple device overhauls. Downstream "Three S" comprehensive operating rates are weak, and demand is poor with high inventory. However, current downstream comprehensive profits are good, and short - term operating rates are expected to remain stable. Inventory is expected to continue increasing, and the valuation is neutral [4]. Summary by Relevant Catalogs Pure Benzene Supply - There are no new device overhauls, and the current operating rate is at a high level, so supply is expected to continue increasing. The restart of some devices and the commissioning of new ones are expected to increase August's output by 70,000 tons month - on - month, still facing great supply pressure [5][16]. Demand - Downstream overall operating rates are high. With the commissioning of the new downstream styrene plant, overall demand is expected to be good [5]. Inventory - Last week, the East China port inventory was 152,000 tons, a month - on - month decrease of 10,000 tons. Overall, pure benzene supply and demand are both increasing, and subsequent inventory is expected to decrease [45]. Valuation - The BZN spread is weak, and the overall valuation of pure benzene is not high [45]. Month - to - Month Spread - Pure benzene is expected to see inventory reduction, and the paper - goods month - to - month spread structure has shifted to the B structure, with the spread likely to strengthen later [5]. Styrene Supply - New device commissioning is expected to increase August's supply, but it may contract in September due to more overhauls. Last week, the operating rate decreased, and overall supply declined. With the commissioning of Jingbo and the restart of overhauled devices, August's supply is expected to increase by about 48,000 tons month - on - month [5][61]. Demand - Downstream "Three S" operating rates remain stable but are weak. Overall downstream profits are good, and demand is expected to remain stable. Currently, the "Three S" are in the off - season, with certain demand resilience, but high inventory may lead to weaker demand later [5][94]. Inventory - Last week, the East China port inventory decreased to 150,500 tons, the South China port inventory increased to 14,500 tons, and the overall port inventory decreased to 165,000 tons. Overall, styrene inventory is expected to increase later [91][94]. Valuation - The BZ - SM spread has decreased significantly, and the styrene valuation is neutral [4]. Month - to - Month Spread - The pattern of strong supply and weak demand combined with improved long - term expectations is expected to maintain the C structure [5]. External Market Support - The US - Asia arbitrage window has been continuously closed. In the first 10 days of August, 38,725 tons of pure benzene were imported from South Korea, a significant month - on - month decrease compared to July and a year - on - year low [5]. Regional Market Conditions Pure Benzene - In North America, there is a large amount of pure benzene inventory due to advance stocking in anticipation of tariffs and poor downstream demand. In Western Europe, traditional downstream demand is sluggish, and pure benzene profits have deteriorated, with Brazilian pure benzene possibly being resold to Europe. In Asia, the US - Asia arbitrage window is closed, and China's pure benzene demand remains stable [50]. Styrene - In North America, the spot market is weak, sellers are reluctant to sell due to low profits, and tariffs have weakened styrene's export competitiveness. In Western Europe, supply is relatively stable, but demand is weak. In Asia, China's downstream demand is stable, while demand outside China remains weak, and styrene production is in the red. Southeast Asian overhauls in August may tighten supply. The US - Europe arbitrage window is open, and the US - Asia arbitrage window is closed [110].

Report Summary 1. Report Industry Investment Rating No information provided. 2. Core Viewpoints - The near - term pure benzene inventory has shifted from accumulation to depletion, and new downstream production news has strengthened the expectation of improved future demand for pure benzene, which is in a transition from weak reality to strong expectation. In contrast, styrene has seen significant port inventory accumulation, with downstream industrial giants actively selling near - term and buying far - term contracts. The near - term spot liquidity has recovered, and the basis in late July has rapidly weakened. The styrene supply - demand pattern has weakened due to the off - season of terminal demand, with only rigid demand support from 3S for styrene. However, recently, influenced by old device inspections and anti - involution macro trends, the overall sentiment of commodities has been positive, and the pure benzene and styrene futures have followed the strong performance of coking coal and coke [4]. 3. Summary by Relevant Content 3.1 Price Forecast and Hedging Strategies - **Price Forecast**: The monthly price forecast for pure benzene is 5,800 - 6,400 yuan/ton, and for styrene is 7,000 - 7,600 yuan/ton. The current 20 - day rolling volatility of styrene is 29.40%, and its historical percentile over 3 years is 85.8% [3]. - **Hedging Strategies**: - **Inventory Management**: For enterprises with high finished - product inventory worried about styrene price decline, they can short styrene futures (EB2509, sell, 25%, entry range: 7,450 - 7,500 yuan/ton) to lock in profits and cover production costs. They can also sell call options (EB2509C7600, sell, 50%, entry range: 120 - 150 yuan) to collect premiums and reduce capital costs, and lock in the spot selling price if styrene prices rise [3]. - **Procurement Management**: For enterprises with low regular inventory and planning to purchase based on orders, they can buy styrene futures (EB2509, buy, 50%, entry range: 7,250 - 7,300 yuan/ton) to lock in procurement costs in advance. They can also sell put options (EB2509P7300, sell, 75%, entry range: 90 - 120 yuan) to collect premiums and reduce procurement costs, and lock in the spot purchase price if styrene prices fall [3]. 3.2 Fundamental Analysis - **Pure Benzene**: The near - term inventory has changed from accumulation to depletion, and downstream new production news has strengthened the expectation of future demand improvement. There are also positive factors such as production reduction due to equipment problems at Shenghong and Zhejiang Petrochemical [4][5][7]. - **Styrene**: The port has seen significant inventory accumulation, downstream industrial giants are actively selling near - term and buying far - term contracts, and the near - term spot liquidity has recovered. The basis in late July has rapidly weakened. It is the off - season of terminal demand, with only rigid demand support from 3S, and the supply - demand pattern has weakened. As of July 21, the styrene inventory at Jiangsu ports was 15.07 tons, an increase of 1.22 tons (+8.81%) from the previous period [4][8]. 3.3 Market Data - **Basis Changes**: The basis of pure benzene and styrene has changed. For example, the basis of East China - BZ03 for pure benzene on July 22 was - 258, a decrease of 27 from July 21; the basis of East China - EB07 for styrene on July 22 was 98, a decrease of 162 from July 21 [9]. - **Price Changes**: The prices of pure benzene and styrene and related products have changed. For example, BZ2603 of pure benzene increased by 37 yuan/ton from July 21 to July 22, and EB2507 of styrene increased by 87 yuan/ton [11][12]. - **Spread Changes**: The spreads in the pure benzene - styrene industry chain have changed. For example, the spread between styrene spot and pure benzene spot decreased by 60 yuan/ton from July 21 to July 22 [10].