Demand for blending components is good in summer

3. Demand for blending components is good in summer.

The peak season for use of automobiles began in July, when demand for gasoline blending picked up. Prices of blending components, MTBE and mixed aromatics in particular, rose rapidly, and the price spread between blendstocks narrowed. Currently, price of mixed xylenes is the highest and mixed aromatics is cheapest. Though demand for toluene and MX does not improve much, the rise in alternative blending components is supportive to toluene and MX prices.

Toluene and MX market remains firm recently, but it depends on macro economy and petrochemical chain to forecast the future trend of toluene and MX. Without driving force from macro economy or notable increase in demand, market sentiment turns cautious after the market plateaus, and the market is in the lack of further advancing momentum. The market is expected to maintain range bound in short term, and it is suggested to focus on the progress of new PX plants.