In April, the domestic methanol market continued to decline after rebounding. According to the price monitoring of SunSirs, the average price of domestic methanol market at the beginning of the month was 1,600 RMB/ ton, and the price of domestic methanol market at the end of the month was 1,657 RMB/ ton, up 3.59% in the month, with a maximum amplitude of 11.88%, and the price was 23.76% lower than the same period last year.
Market Analysis
Product: domestic methanol rebounded in the first half of April and bottomed out again in the second half. Due to the downstream staged stock and considerable procurement of olefins, Shandong and other places in the mainland consumer market took the lead to go higher, while the northwest and other places went up. Shenhua Yulin parked during the Qingming Festival; the sales pressure on the northwest region was prominent. After the middle April, the price began to fall sharply, and the lowest price in Northern Shaanxi fell to 1,280-1,330 RMB/ ton. By the end of the month, due to the considerable influence of the downstream procurement such as Ningxia Baofeng, the main production area gradually stopped falling and stabilized, slightly rebounded.
Industry chain: formaldehyde: lalst month, the domestic formaldehyde market presents a wide range of shocks. Driven by upstream methanol exploratory pushed up, formaldehyde enterprises had followed up. In the downstream, China's wood processing products are mainly exported to the United States and Europe. Influenced by covid-19, at present, the export of wood processing products continues to be limited, the demand for formaldehyde rapidly declines, the trading atmosphere gradually weakens, and the terminal demand is scarce.
Acetic acid: the domestic acetic acid market rose by 450-620 RMB/ ton in April. After the early period of continuous decline, there is no acetic acid reserve in the hands of downstream factories and middlemen. Under the optimistic attitude of the latter period of acetic acid, traders and downstream factories have limited shipments to promote the transaction price of acetic acid to go up in succession. In the middle and early period of the month, mainstream manufacturers have announced the maintenance time, focusing on the end of April and the beginning of May. In the later period of supply, traders actively replenished and purchased, pushing the price of acetic acid up to the end of April.
DME: last month, the market price of DME was up and down, and the price was up and down. At the beginning of the month, the price of crude oil soared, driving the prices of methanol in the upper reaches, LPG and DME in the lower reaches to rise rapidly, promoting the enthusiasm of terminal procurement, and the price of DME continued to rise. After entering the middle April, due to the sharp rise in propane price, the price rose to 1,000 RMB/ ton, and civil gas and other related products began to rebound strongly on April 13, supporting the continuous increase in the price of DME. After entering the late ten days, the crude oil price began to plummet, leading to the collapse of terminal purchasing confidence, most of them left the market to wait and see, and the actual transaction was limited.
Industry: according to the price monitoring of SunSirs, there were four kinds of commodities in the list of rise and fall of bulk commodity prices in April 2020, among which the top three commodities were LPG (4.99%), MTBE (4.92%) and methanol (3.59%). There were 12 kinds of commodities falling on a month on month basis, with 6 kinds of commodities falling by more than 5%, accounting for 37.5% of the monitored commodities in the sector; the top three products falling were WTI crude oil (-25.05%), asphalt (-23.39%) and naphtha (-18.96%). This month's average price was -6.46%.
Market Forecast
From the perspective of SunSirs: on the positive side, the price of domestic methanol fell sharply in late April, which has fallen below the cash flow cost in most regions. Some enterprises with high cost consider parking response; methanol to olefin integrated unit plans to purchase methanol. On the negative side, the international oil price once fell to a negative number in April, the market panic spread, and investors' interest was not high; the methanol to olefin maintenance was centralized, and the purchase volume was significantly reduced; the traditional downstream demand did not improve, especially formaldehyde and MTBE; the production of most international methanol plants was stable, and the import was expected to remain high in May June. The public health emergency triggered international financial risk aversion, and the collapse of oil price caused by COVID-19 was very adverse to the trend of domestic energy chemical products. Methanol market will also fluctuate in the short term, constantly testing the production cost of the plant. At present, methanol supply and demand are unbalanced. Methanol analysts of SunSirs predict that the domestic methanol market will continue to decline in the short term.
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