China’s September Aromatics Trade Diverges Amid Supply Constraints, Strong Demand

Trade flows in China’s aromatics market in September were defined by a clear divergence between strong upstream raw material demand and softening downstream chemical derivatives.

The polyester chain highlighted this supply-demand split most clearly through contrasting movements in upstream paraxylene and downstream purified terephthalic acid. PX imports surged to 688,208 metric tons—a sharp 16.4% month on month increase, according to customs data, driven by strong domestic demand and tighter supply due to ongoing plant maintenances.

According to Chemical Market Analytics by OPIS data, approximately 219,000 mt of PX supply in China was offline in the month of September. This included Fujian Fuhaichuang Petroleum Chemical Industry Co.’s 1.6 million mt/year PX plants in Fujian, Hongrun Petrochemical (Weifang) Co.’s 800,000 mt/year PX plant in Shandong, Sinopec Hainan Refining and Chemical Co.’s 1.68 million mt/year PX plants in Hainan and Sinopec Yangzi Petrochemical Co.’s 850,000 mt/year PX plants in Jiangsu.

Conversely, PTA exports fell 13.8% month on month to 313,441 mt as reduced supply, strong retention for domestic polyester plants and soft overseas demand curtailed PTA outbound shipments.

Average Chinese PTA plant operating rates dipped to 70.2% at the end of September, prior to the National Day holidays in early October, down 2.8 percentage points week on week, according to an industry source. Moreover, a wave of unplanned maintenance at the end of September saw Ineos Zhuhai taking its 1.25 million mt/year Guangdong unit offline for about one to two days. Concurrently, Zhejiang Dushan Energy briefly halted its 2.5 million mt/year No. 1 lines, while Yisheng Hainan trimmed operating rates at its 2.5 million mt/year plant to 90%, with a potential step-down to 80% looming, industry sources said.

Similarly, in the downstream polyester textile sector, operating rates in the Jiangsu-Zhejiang region have decreased further with yarn texturing and weaving standing at 49% and 56%, respectively, at the end of September, down 15.5 percentage points and 5 percentage points, respectively, week on week.

China’s mixed xylene and toluene markets reflected similar dynamics of domestic self-sufficiency bolstered by pre-National Day holiday restocking, month-end short covering and firmer gasoline blending demand ahead of the peak October travel season. Prompt cargoes drew additional support from tight supply due to reduced inventory levels at the end of September. MX imports saw a near-total collapse, plummeting 98.1% month on month to just 38 mt as robust local demand erased the appetite for imported spot cargoes, while MX export activity registered a minor uptick to 1,006 mt, up from zero exports in August.

Meanwhile, toluene exports moderated from earlier peaks, dropping 19.7% month on month to 137,551 mt amid tighter local supply availability and overall firmer domestic spot prices which led sellers to scale down outbound flows. According to OPIS data, domestic Chinese toluene September monthly average price stood at 8,476 yuan ($1,269.84)/mt ex-tank, up 1,474 yuan/mt month on month.

China’s benzene imports slipped 3.8% month on month to 386,589 mt in September, according to customs data. Spot availability was constrained by tight regional supply across Asia due to plant turnarounds and an open South Korea–U.S. arbitrage window. While South Korea exported 171,000 mt of benzene to China and none to the U.S. in September, a widening Asia–U.S. price spread has since reactivated the trading lane. At least one 25,000 mt cargo has already been booked for October delivery to the U.S., with negotiations active for November shipments, according to CMA data.

Similarly, the Chinese styrene monomer market was supported by prompt supply tightness resulting from domestic production cuts and elevated feedstock benzene costs. However, the upside momentum was capped by sluggish downstream polymer demand and compressed processing margins. SM imports dropped 48.7% month on month to 6,390 mt while SM exports rose 3.8% month on month to 118,011 mt, customs data shows.

–Reporting by Serena Seng, serena.seng@dowjones.com; Editing by Mei-Hwen Wong, mei-hwen.wong@dowjones.com