Report Title - Pure Benzene & Styrene Weekly Report: Market Sentiment Ebbs, Pure Benzene and Styrene Fluctuate [1] Report Industry Investment Rating - Not provided Core Viewpoints - The styrene market sentiment fluctuates significantly, and pure benzene and styrene are running in a volatile manner. The fundamentals of styrene are improving, and the market is running strongly. The trading strategy for the single - side is bullish, but geopolitical risks need to be monitored [4]. Summary by Directory PART ONE: Main Views and Strategy Overview - **Supply**: The styrene - naphtha spread has widened to $419, and the styrene - benzene spread has reached $232. Producers have returned above the cash break - even line, showing a bullish trend [4]. - **Demand**: As of February 2, 2026, the total commercial inventory of pure benzene at Chinese ports was 312,000 tons, a decrease of 11,000 tons from the previous period, with a month - on - month increase of 3.41%. Compared with the same period last year, the inventory increased by 188,000 tons, a year - on - year increase of 101.29%, indicating a bullish trend [4]. - **Inventory**: As of February 2, 2026, the total inventory of styrene at Jiangsu ports was 108,600 tons, an increase of 8,000 tons from the previous period, a rise of 7.95%. The commercial inventory was 60,800 tons, a decrease of 1,500 tons from the previous period, a decline of 2.41%, showing a neutral trend [4]. - **Basis**: The styrene basis strengthened. As prices rebounded, the operating load of styrene plants recovered, showing a bullish trend [4]. - **Profit**: The styrene - naphtha spread widened to $419, and the styrene - benzene spread rose to $232. Styrene profits were significantly repaired, showing a neutral trend [4]. - **Valuation**: Market sentiment dropped significantly, and overseas export demand drove up prices, showing a neutral trend [4]. - **Macroeconomic Policy**: On the evening of February 4, Chinese President Xi Jinping had a phone call with US President Trump, showing a bullish trend [4]. - **Investment View**: The styrene fundamentals are improving, and the market is running strongly with a volatile trend [4]. - **Trading Strategy**: The single - side strategy is bullish, and geopolitical risks need to be monitored [4]. PART TWO: Pure Benzene & Styrene Fundamental Overview - **Crude Oil**: The negotiation between the US and Iran affects crude oil prices [6]. - **Styrene**: Styrene plant profits continue to expand, and the supply side is gradually recovering [16][28]. PART THREE: Polymer Demand Overview - **ABS**: ABS has entered the stage of active inventory reduction [52]. - **PS**: The production profit of PS is at a low level, and demand has entered the off - season [66]. - **EPS**: The price of EPS has rebounded slightly [76]. - **Overseas Benzene Market**: Driven by strong energy prices, the overseas benzene market has risen. However, downstream demand is under pressure, and multiple styrene plants are planned to be shut down in the first quarter. The US benzene price is lower than that in Europe, and the arbitrage window has opened. The winter storm has limited impact on supply. European pure benzene has become the global price high, about $80 higher than in the US and nearly $200 higher than in Asia. European supply is limited due to unstable plant operations. Although the cracking spread is still economically viable for extraction, rising energy costs have squeezed profits. The market is supported by short - term spot shortages, but there are concerns about future supply - demand surpluses [75]. - **Asian Benzene Market**: The rebound of Asian benzene is mainly driven by the improvement of the styrene industry's profitability, the recovery of production, and the resumption of exports to the US. The benzene - naphtha spread has widened to $187, supporting the economic viability of aromatic extraction. High pure benzene inventories and the widening toluene spread limit the increase, and import demand is weak. Plants such as CNOOC, Maoming Petrochemical, and Sinopec Shanghai have restarted one after another, and the new cracking plant of BASF in Guangdong has been operating stably, while the short - term shutdown of Zhejiang Petrochemical's reforming plant has limited impact. South Korean cracking plants have shifted to naphtha raw materials, increasing the by - production of benzene. PX and TDP plants are operating stably, and supply is expected to be abundant in February. The current price difference between the US and Asia is $88, which is not enough to open the arbitrage window. The overall supply - demand in the Asian benzene market is balanced, mainly supported by styrene demand [84]. - **Overseas Styrene Market**: The impact of the storm on the overseas styrene market was short - lived. Some plants in Texas were temporarily shut down and then restarted, with limited overall production losses. Quotes in the North American market are scarce, and the arbitrage window between the US and Europe has opened, with a spread of $69. However, US exports are limited by plant shutdown plans and logistics disruptions. Styrene in Europe has strengthened for two consecutive weeks, and the increase in styrene has significantly outperformed that of raw material benzene, with the spread widening to $200. The overall supply is stable, but short - term imports from the Middle East are restricted, and the import volume from the US and Europe in January was only about 20kt. As the spring maintenance season approaches, downstream replenishment demand has increased, and combined with the expectation of the peak season in the second quarter, market concerns about supply shortages have intensified [94]. - **Phenol**: The port inventory of phenol has declined rapidly [96]. - **Adipic Acid**: The profit and operating load of adipic acid have declined [107]. - **Caprolactam**: The operating load and inventory of caprolactam have increased [119]. - **Home Appliances**: The demand for home appliances is waiting for an increase [128]. - **Asian Styrene Market**: The price and economic situation of Asian styrene have recovered, mainly driven by supply tightening, unexpected shutdowns in the Middle East, surging export demand, and rising costs. The styrene - naphtha spread has widened to $419, and the styrene - benzene spread has reached $232. Producers have returned above the cash break - even line. Although the market is worried that the approaching Spring Festival holiday, pressured polymer profits, and the restart of some plants will suppress demand, strong exports, short - term supply gaps caused by domestic maintenance, and speculative buying driven by chemical futures support the strong spot price. On the supply side, multiple plants are still under maintenance or shut down due to failures, and some production capacities in Taiwan, China, and Japan are planned to resume in February; Middle East supply is expected to gradually return in February, but new maintenance plans in March will limit the increase in supply. On the demand side, there is a divergence: the operation of PS and ABS downstream of styrene is stable, but the operation of EPS has declined, and high costs are squeezing polymer profits, and some manufacturers are considering production cuts or even reselling styrene raw materials [133].

Report Information - Report Name: C3 Industry Chain Weekly Report [1] - Report Date: January 4, 2026 [1] - Analyst: Chen Xinchao [1] - Contact Person: Zhao Shucen [1] Investment Rating - Not provided in the content Core Views LPG - Geopolitical factors disrupt costs, and attention is paid to the realization of downward drivers. The market is relatively stable during holidays, with the internal PG fluctuating and consolidating. After the holiday, the high opening of the January CP official price boosts market sentiment, but the coexistence of supply return and weakening chemical demand expectations remains, and the loose pattern remains unchanged. The market price rises and then falls. In the future, the geopolitical conflict between the US and Venezuela during the holiday is expected to disrupt the cost-side crude oil in the short term, and the increase in the January CP will support the propane trend. However, high prices suppress buying interest, the actual import cost support is limited, and the supply pressure remains. Meanwhile, the current chemical profit is at a low level, there are many PDH maintenance plans in the first quarter, the economic efficiency of cracking propane feedstock is insufficient, and the procurement increment is limited, so the downward driver is gradually emerging. [4][5] Propylene - There is limited upward and downward driving force, and the spot price trend stabilizes. Next week, there will be a mix of start-ups and shutdowns in terms of supply, and the demand side is expected to increase. Overall, propylene lacks obvious trend guidance and is expected to remain volatile and stable in the short term. However, the high opening of CP further compresses the profit of PDH devices, and attention should be paid to the realization of the expected increase in unexpectedly shut-down devices in the first quarter. [8] Summary by Directory LPG Part Price & Spread - Domestic LPG spot prices and basis show regional differentiation in civil use trends, and import costs are relatively firm. The prices of propane in the international market show a certain degree of fluctuation, and the spot premium has significantly declined. [11] - The domestic LPG market price shows a pattern of strong performance in South China and stable performance in East China and Shandong. [15] - The regional quotes, premiums, and freight rates show that the CP official price opens high, but the premium falls. [23] - The propane price has declined month-on-month. [32] Supply - The US LPG shipment volume to Asia has increased month-on-month, while the Canadian LPG shipment volume remains relatively stable. The Middle East LPG shipment volume is tight in the spot market, and the shipments are delayed. The total LPG commodity volume in China has increased slightly, and the propane commodity volume has decreased in terms of import arrivals. [42][48][49][64][76] Demand & Inventory - In terms of chemical demand, the PDH operating rate has increased, while the MTBE operating rate has decreased. The domestic LPG refinery inventory is at a relatively low level compared to the same period last year, with limited month-on-month changes. The civil LPG refinery inventory has changed little month-on-month. The LPG terminal import inventory has significantly decreased month-on-month due to lower-than-expected arrivals. [80][82][90][99] Propylene Part Price & Spread - In the propylene industry chain, the cost-side propane first declines and then rises, while the propylene price remains stable. The prices of some downstream products of propylene have improved, and the profit of powder materials has improved. The international/US dollar price of propylene remains flat month-on-month, and the domestic price trend remains stable. [111][113][115][123] Balance Sheet - In the propylene industry chain, the PDH operating rate has increased month-on-month; the powder material operating rate has further declined, while the butanol and octanol operating rates have significantly increased. The supply and demand of propylene in the national and Shandong regions show certain changes, and the inventory has also changed accordingly. [135][138][144][150][155][157][162] Supply - The overall upstream operating rate of propylene is 75.0% (+0.9%). The refinery/main operating rate remains at 75%, and the local refinery operating rate is 56%. The ethylene cracking operating rate is 82.8% (-0.4%), and the cracking profit center has slightly improved month-on-month. The PDH capacity utilization rate is 76.4% (+1.4%), and the MTO capacity utilization rate is 87.8% (-1.7%). [167][169][179][184][189] Demand - The downstream PP capacity utilization rate is 76.9% (-2.5%), and the profit has stopped falling and slightly recovered month-on-month. The PP powder capacity utilization rate is 37.6% (+0.7%), and the spread between powder materials and propylene has continued to recover, with some devices returning. The PO capacity utilization rate is 74.1% (-2.0%), and the operating rate is expected to decline slightly further. The acrylonitrile capacity utilization rate is 80.3% (-0.3%), and the profit has increased month-on-month. The acrylic acid capacity utilization rate is 79.9% (+0.4%), and the profit has increased month-on-month. The n-butanol capacity utilization rate is 79.9% (+2.1%), and the profit has increased significantly month-on-month. The octanol capacity utilization rate is 85.0% (+3.0%), and the profit has increased month-on-month. The phenol-ketone capacity utilization rate is 78.5% (+2.5%), and the profit has increased slightly month-on-month. The ECH capacity utilization rate is 50.82% (+2.39%), and the price and profit have both increased month-on-month. [203][208][221][230][235][243][251][254][264][266][273] Downstream Inventory - The inventory of PP production enterprises, traders, and ports has changed slightly. The inventory of PP powder materials has also changed slightly. The inventory of acrylonitrile factories and ports remains stable, while the inventory of phenol and acetone in Jiangyin Port has decreased. [277][288][290]