Downstream demand upholds the Benzene prices in the US market

Texas- Benzene prices in the US market continued to climb in early June 2023 as the US market witnessed a better demand outlook from end-use manufacturing units that as cumene, styrene, and other solvent-consuming industries. The strengthening of the US dollar instigated a conservative attitude that led to a drop in Crude Oil prices for the second week straight. Prices first increased because Saudi Arabia promises to make production changes, but later came under pressure from rising US fuel inventories and dismal Chinese export data.  Contrary to the upstream (crude oil) prices, Benzene prices continued to move upwards, and price quotations were observed at USD 1235 per MT, FOB Louisiana. 

Adding to the above-mentioned facts, other facets governing the overall market dynamics of Benzene in the US market include the ground port production that slowed to a standstill. This occurred due to the International Longshore and Warehouse Union workers' slow and moderate operation. Marine Traffic, a provider of supply chain intelligence, claims that as a result, there has been a surge in the typical number of containers waiting outside the port boundaries.

The International Longshore and Warehouse Union (ILWU), which represents around 15,500 dockworkers, and 29 West Coast ports are currently in the closing phases of negotiating a new labor agreement that addresses everything from pay to operational work standards. Over half of all imports into the United States pass through ports on the West Coast, including those in Los Angeles, Long Beach, Seattle-Tacoma, and Oakland. As a ripple effect, truck arrival and departure times at the ports of Los Angeles and Long Beach for container pickup have increased. The demand for Benzene also remained on a positive note from the international market as one of the major manufacturers of Benzene in the Asian market (South Korea) has gone under maintenance creating a gap in the supply chain for Benzene in the overseas market. Seeking this situation as an opportunity, Benzene manufacturers and suppliers kept the prices on the upper edge.

More than twice as many Benzene containers as there were last week are currently sitting outside of the port boundaries for the Port of Los Angeles. Currently, private equity investors in North American chemical companies are primarily concerned with operational upgrades at their existing portfolio companies. As per ChemAnalyst, Benzene prices are expected to move forwards at a stagnant pace in the domestic market amid the continuous demand offtakes from solvent industries.