China's PX imports have fallen since early 2025, weak demand may cap prices

China's paraxylene imports have been reflecting a declining trend since the start of 2025, and although this may support prices to a certain extent, weak domestic and export demand could put a lid on prices, market sources said March 24.

China's imports of paraxylene fell 3% month over month in February after dropping 15% from the previous month in January, recent customs data showed.

Spot PX prices improved somewhat in early 2025, especially since supply cuts came into effect in mid-January. Platts, part of S&P Global Commodity Insights, assessed Asian PX CFR Taiwan/China averaged $879.54/mt in February, up from January's average of $865.57/mt.

However, the price increase lost momentum in March as demand cues remained depressed, with CFR Taiwan/China prices averaging $835.86/mt month to date, Platts data showed.

The slowdown in PX imports did come as a surprise for a large part of the market, a trader in Singapore said, who added that the "market never saw that coming [and] all Chinese [market participants] are [very] bearish," referring to lower PX imports so far this year.

With reduced PX buying appetite, spot prices may find near-term support, but the chances of a solid rise in prices seem unlikely as the downstream market struggles, the trader added.

The main concern for market participants is the weak domestic and export demand, particularly for downstream polyester products, which is significantly pressuring upstream prices.

To mitigate these pressures, producers in other parts of Asia, such as South Korea, are curbing PX production by lowering operations or planning turnaround extensions. These supply curbs have helped stabilize prices in China somewhat, traders said, even though the Chinese government's efforts to boost domestic consumption have not yet succeeded.

Currently, however, oil price movements are more active in shaping spot prices than PX demand-supply fundamentals, traders said.

In midmorning Asia on March 24, oil prices were on the weaker side, which in turn pushed PX spot prices much lower compared with the previous day's close, Platts data showed.

Sanctions support

The US recently sanctioned an independent refinery in China's Shandong Province on March 20 for buying millions of barrels of Iranian crude, the first such sanction against an independent refinery, according to the US Treasury Department, although market sources suggested this will not directly impact Asian PX markets.

However, the sanction could potentially impact the Chinese MTBE market, with some ramifications emerging in the near term, sources said.

The sanctioned independent refinery had been keen to sell around 40,000 mt of MTBE for end-April loading, said a market source. However, buyers who had purchased from the supplier would now have to source their cargoes elsewhere.

Another major Chinese refiner that recently sold some MTBE cargoes around the $680-$690/mt FOB China level will likely struggle to fulfill those orders since China's MTBE prices are expected to rise due to the sanction, said a second Singapore-based trader.

Platts assessed MTBE FOB Singapore at $717.43/mt at the Asian close March 21, up $7.84/mt day over day.

Another potential issue could arise from cargo stored at China's Huaying Huizhou terminal, which holds both crude and refined products, particularly from Shandong refiners. US President Donald Trump's targeting of one Chinese independent refiner may lead to other similar refiners being targeted, creating uncertainty, a market source said, explaining that the terminal's stored products could be at risk as the cargoes might originate from either the sanctioned refinery or a sanctioned tanker.

A PX producer in North Asia said changes in feedstock buying by sanctioned entities could eventually have a trickle-down effect on aromatics production.

"If their MTBE exports are disrupted, there's a chance they may have to reduce their run rate," the producer said.

Furthermore, as supplies of cheaper Iranian barrels are cut off, higher feedstock costs could pressure refinery operations, potentially leading to a cut in run rates, traders said.

As run rates drop, xylene production could slow, which could help manage the current xylene oversupply, the PX producer said, adding, "Although the xylene market is currently slightly oversupplied, this issue [of lower run rates] might help support xylene prices, which could also provide some support to PX."