Organic Chemicals Remain High Prices

Phenol
In early April 2007, China's phenol price remained bullish, and
with the restart of phenol/acetone units in Sinopec Beijing
Yanhua Petrochemical being ahead of schedule, there were few
trading actions in the market, and the price of phenol dropped
considerably afterwards.
   As of April 25th, 2007 the bulk trading price of phenol was
at RMB14 600-14 700/t in the ports of East China, a drop of
RMB50-100/t from a month before, and in other regions of China,
the prices dropped RMB600/t to RMB14 600-14 700/t.
   Due to the cost pressure caused by the high price of phenol,
several downstream plants in North China and East China will
discontinue production to reduce losses, and demand for phenol
will shrink, so the price may fall constantly.

Acetone
In April 2007, with the overhaul of phenol/acetone units in
Sinopec Beijing Yanhua Petrochemical and cost increase of
imports, the price of acetone increased slightly.
   As of April 25th, 2007 acetone was trading at RMB8 020-8100/t
in the ports of East China, an increase of RMB20-50/t over a month
before, and in South China the bulk trading prices rose RMB100/t
to RMB8 600/t.
   In May 2007, a shipment of around 5 thousand tons will reach
East China from LG Chem of Korea at a price of US$850-860/t CFR
East China.
   Offers of price by oversea acetone producers will maintain
at high level, and China's acetone price therefore will rise
slightly.

Pure Benzene
In early April 2007, because the price of pure benzene continued
to rise in Asian markets, some domestic pure benzene producers
raised the ex-work prices. Due to the low inventory and demand
increase, the price of pure benzene in East China increased
considerably.
   As of April 25th, 2007 pure benzene was traded at RMB9 250-9
300/t in East China, an increase of RMB100/t over a month before,
and the offer price in Asian markets rose US$115/t to US$1 140-1
150/t FOB Korea.
   The Asian market will be brisk, however, due to the sufficient
supply in domestic market and demand shrink for pure benzene in
downstream producers, the price of pure benzene will lack force
to rise.

Toluene
In April 2007, because of the boom of the US market, the prices
of toluene in Asian markets rebounded and promoted the price rise
of China's toluene market.
   As of April 25th, 2007 toluene was traded at RMB7 700-7 800/t
in East China, a rise of RMB220-300/t over a month before, and
the offer prices in Asian markets were up US$10-20/t to
US$860-870/t FOB Korea.
   Sellers are generally optimistic to the future market,
however, due to the high inventory, the price of toluene is
expected to be stable.

Xylene
In April 2007, due to the brisk demand in downstream sectors,
the price of xylene increased considerably.
   As of April 25th, 2007 solvent grade xylene was traded at RMB8
100-8 200/t in East China, a rise of RMB200-300/t over a month
before, and the offer prices in Asian markets were up US$20-40/t
to US$860-880/t FOB Korea.
   Due to brisk demand, low inventory and high offers of imported
price, the price of xylene will probably be stable or climb.

Styrene
In April 2007, the demand for styrene rebounded and the price
increased steadily in East China. The prices of styrene in Asian
markets were bullish due to the price rise in the US and European
markets.
  As of April 25th, 2007 styrene was traded at RMB12 100-12 150/t
in East China, an increase of RMB250-300/t over a month before,
and the offer prices in Asian markets rose US$75-90/t to US$1
330-1 350/t FOB Korea.
  Due to the high inventory and demand rise in downstream sectors,
the market price of styrene will continue to fluctuate.