Price trend

According to the Commodity Market Analysis System of SunSirs, the domestic MDI market fluctuated and fell in August. From August 1st to 29th, the domestic market price of MDI increased from 17,616 RMB/ton to 17,300 RMB/ton, with a price drop of 1.8% during the month and a year-on-year price drop of 1.8%.

Analysis review

In early August, domestic MDI prices continued to decline due to relatively high prices, a strong wait-and-see atmosphere downstream, and sluggish upstream sales, resulting in a weak and downward trend in the MDI market.

In mid August, with the consolidation and operation of MDI, the MDI market remained stable after a decline, with a clear willingness to raise prices in the upstream and on-demand procurement in the downstream. Subsequently, foreign companies were unable to reduce production due to force majeure, which boosted the news and led to a slight increase in MDI.

In late August, the market demand increment was limited, and the main focus was on digesting the increase. To stimulate sales, the focus of some actual transactions had begun to shift slightly downwards.

On the supply side, Huntsman's 470,000 tons/year MDI production plant located in Rosenburg, the Netherlands, announced on August 5th local time that it was affected by the incident and was operating at low negative load. It resumed normal operation on the 13th. The 1.1 million ton MDI units of Yantai Wanhua and 80,000 ton MDI units of Dongcao Rui'an in China were temporarily under maintenance.

On the cost side, raw material pure benzene: The domestic pure benzene market was fluctuating upwards. As of August 29th, the benchmark price of pure benzene in SunSirs was 8,560 RMB/ton. Raw material aniline: The domestic aniline market had fluctuated and risen, with gains returning at the end of the month compared to the beginning of the month. As of August 29th, the benchmark price of aniline in SunSirs was 10,125 RMB/ton. The cost support for MDI was weak.

On the demand side, downstream companies entered the market at low prices, purchased on demand, and had a clear resistance to high prices. Under the dominance of the demand side, the market was prone to decline but difficult to rise.

Market outlook

Recently, the willingness of suppliers to ship had increased, and the focus of market transactions had shifted downwards. With limited demand growth, MDI analysts from SunSirs predict that the domestic MDI market will mainly be weaker and follow suit.

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