On June 22, the Ministry of Commerce of the People's Republic of China issued an announcement and decided to impose anti-dumping duties on styrene products originating in South Korea, the United States, and Taiwan, China, starting from June 23. The tax rate is 3.8%-55.7%, and the levy is 5 years. Years. The author believes that this ruling will bring lift to the current stumbled styrene market.
China is the world's largest demander of styrene. The proportion of demand in the world has been 33%-34% in the past two years, and the apparent consumption has reached 9.7 million to 9.8 million tons. However, the ratio of capacity to demand does not match. It has created a long-term supply gap for styrene in China, and requires a large amount of imported styrene and downstream derivatives every year. For example, in 2017, Northeast Asia, North America, and the Middle East are still the main source areas for China's styrene imports. The first one is South Korea, accounting for about 35.41%; US imports accounted for 9.52% of total annual imports, ranking third; China's Taiwan imports accounted for about 7%, ranking fourth. Visible, 2017, China 51.93 % of imported styrene comes from South Korea, the United States and Taiwan. The target of this anti-dumping is related to major importing countries and regions.
Although the domestic supply of styrene is increasing year by year, as of 2017, the domestic dependence of styrene remains above 30%. After the implementation of anti-dumping duties, the cost of exporting styrene to China in these countries and regions is bound to increase. Especially in the United States. As tariffs rise and the transportation cycle is too long, the theoretical arbitrage window will be closed. Therefore, the market expects that the number of ocean-going cargoes from the United States will be directly sold to China. The anti-dumping will reduce the inflow of imported goods to a certain extent, reducing domestic demand. Market production and sales pressure.
This anti-dumping will reinforce the market's bullish attitude. From the end of May to the beginning of June, the domestic styrene market was tight and the price quickly rose to RMB 14,500/t, tying the next highest level in the market for 10 years. Since then, the market has been continuously The highs have fallen. As of mid-June, the market has still not escaped the downtrend channel. At present, the supply and demand side of the game is playing out with knots and dips and replenishment confrontation. The market is in a stalemate. At this time, anti-dumping measures are launched to boost the market's bullish atmosphere. A rebound has taken place. With the favorable results such as the end of month delivery and oversold, the chances of market corrections rising have increased. This has led to a rebound in the price of styrene by the end of June.