Price trend

In early February, the price of MDI in the market increased, domestic facilities were running smoothly, there were more inspections abroad, and the filling of goods sources was slow. The mainstream quotation for Shanghai goods (44V20, M20S, 5005) was 18,700-18,800 RMB/ton, while the mainstream quotation for domestic goods (PM200) was 18,800-19,000 RMB/ton.

In mid to late February, the market price of MDI slightly declined. Returning after the holiday, downstream demand has recovered slowly, and there was sufficient supply of goods on site. Due to low transaction volume, traders were accelerating the delivery of goods through express delivery, increasing the room for negotiation.

Analysis review

On the supply side, except for parking and maintenance in Fujian, all other facilities in China were running smoothly. There were many maintenance projects abroad, and the 410,000 tons/year MDI plants in Jinhu, South Korea was scheduled to start maintenance on February 9th, lasting for about a month. BASF's 250,000 tons/year MDI plant in South Korea was scheduled to undergo maintenance starting from February 9th, lasting approximately one month. The 70,000 ton/year MDI plant of Japan's Covestro will begin maintenance in early March and is expected to be serviced around January.

On the cost side, raw material benzene: The domestic benzene market was fluctuating and rising. As of February 26th, the benchmark price of benzene in SunSirs was 7,792 RMB/ton. Raw material aniline: The domestic aniline market has slightly increased, and as of February 26th, the benchmark price of aniline in SunSirs was 9,162 RMB/ton. The overall increase in raw material costs has strengthened the support for MDI.

On the demand side, downstream demand for essential procurement was weak, and downstream resumption of work after the holiday was mainly driven by essential needs, with a shortage of new orders.

Market outlook

The current MDI market atmosphere was relatively quiet, with intermediary prices following the market trend and no obvious support on the news side. It is expected that the MDI market will operate to be weaker in the short term.

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