Huatai Futures: Iran Situation Impact, Methanol, Pure Benzene, and Styrene Strengthen

Hot Topics\n\nSelected Stocks\nData Center\nMarket Center\nCapital Flows\nSimulated Trading\n\nClient\n\nSource: Huatai Futures\n\nAuthor: Chemical Group\n\nOn March 12, MA2605 contracts rose by 4.6%, BZ2604 contracts increased by 4.6%, and EB2604 rose by 2.2%.\n\nCurrently, the situation in Iran and the navigation status of the Strait of Hormuz remain key factors affecting the chemical sector. Amid concerns that oil shipments through the Strait of Hormuz are impacted, yesterday’s market still expects the possibility of further production cuts by a major petrochemical group’s refinery. There are also worries about further declines in domestic oil and chemical supply, especially in aromatics, leading to a relatively strong performance of PX and pure benzene. How long the aromatic sector will stay strong depends on the reopening of the Strait of Hormuz to shipping. We will continue to monitor the shipping traffic, which remains at low levels.\n\nCurrently, port inventories of pure benzene at Longzhong remain high, but the market outlook suggests that supply has declined due to refinery operations being affected by crude oil transportation issues. If production further decreases, pure benzene is expected to enter a destocking cycle. For styrene, Zhejiang Petrochemical has also begun to implement its maintenance plan for its 600,000-ton/year styrene plant scheduled for early April.\n\nAs for methanol, Iran’s methanol plants are mostly shut down at the moment. Imports arriving at ports from March to April have further decreased to historic lows, and port inventories are expected to enter a rapid destocking phase. This week, port inventories have also started to decline, and we are watching for the turning point when inventories shift from high levels to destocking.\n\nTherefore, until the Strait of Hormuz reopens for further navigation, it is advisable to remain cautious and consider buying on dips for MA2605, BZ2604, and EB2604 contracts as a hedge.\n\nRisk Warning: Developments in Iran’s conflict and significant fluctuations in oil prices; changes in refinery operating loads.\n\nInvestment Consulting Qualification: Securities Permit [2011] No. 1289\n\nDisclaimer:\n\nThis report is prepared based on information deemed reliable and publicly available by our company, but we do not guarantee its accuracy or completeness. The opinions, conclusions, and forecasts in this report reflect only the views and judgments at the time of publication. Our company may issue research reports that differ from the opinions, assessments, and forecasts contained herein at different times. We do not guarantee that the information in this report remains up-to-date. We reserve the right to modify the information without notice. Investors should pay attention to updates or revisions. We strive for objectivity and fairness in the report, but the opinions, conclusions, and recommendations are for reference only. Investors should not rely solely on this report to make decisions. Our company and authors are not responsible for any consequences resulting from reliance on or use of this report. All copyrights of this report belong to our company. No organization or individual may reproduce, copy, publish, quote, or redistribute in any form without our written permission. If quoting or publishing is authorized, it must be within permitted scope and with attribution to “Huatai Futures Research Institute,” and any quotes or modifications must not distort the original intent. We reserve the right to pursue legal responsibility. All trademarks, service marks, and logos used in this report are trademarks and service marks of our company. Huatai Futures Co., Ltd. owns all rights.\n\nOpen a futures account with Huatai — professional and trustworthy\n\nMassive information, precise analysis, all on Sina Finance APP\n\nEditor: Zhu Hennan