China's benzene prices shivered upward in June on improved supply-demand situations, as well as rising crude oil and international benzene prices. By June 26, East China benzene price was 4,880yuan/mt, up 330yuan/mt from end May. Sinopec revised up benzene listed price by 350yuan/mt in total within June. Sinopec settled June benzene contract price at 4,569yuan/mt, up 119yuan/mt from May settlement. The price is the average listed price from May 26 to June 25.

Upstream crude oil prices moved up on geopolitical tensions. Asian benzene prices went up on the back of firmer USGC prices due to tight supply in US. Asia-US arbitrage window remained open. In June 1-20, South Korea expected 159kt of benzene. About 109kt was headed to US while only 11kt to China.

Due to thin trades of CFR China cargoes, benzene imports decreased and port inventory continued going down.

According to China Customs, China imported 132kt of benzene in May, down about 122kt or nearly 48% month on month, and down about 28% year on year. As CFR China benzene prices remained higher than China domestic level, buyers showed little interests in import cargoes.

Unit:KG	Apr	May
South Korea	143,918,845	84,068,214
India	28,499,962	0
Japan	23,943,177	9,002,521
Thailand	17,760,771	17,424,619
Kuwait	11,785,293	3,000,000
Taiwan, Prov.of China	9,999,612	0
Viet Nam	5,929,123	0
Saudi Arabia	5,923,986	12,355,396
Malaysia	3,136,540	6,136,060
Singapore	2,899,205	0
United States	0	9

Benzene inventory fell below 200kt this week. Benzene inventory decreased by 11.5kt week on week to 194kt in East China ports on Jun 26, according to data released by CCFGroup.



Persistent decrease in port inventory as well as opened arbitrage from South Korea to US could lend some supports to market prices. However, the upward momentum is weak with clear boosts from downstream demand. In downstream derivatives, SM has robust margins, while cash flows of other products are low.