SunSirs: China MTBE Market Trend first Rises and then Falls

According to the Commodity Market Analysis System of SunSirs, from October 21st to 25th, the MTBE price first rose from 5,487 RMB/ton and then fell to 5,475 RMB/ton, with a price drop of 0.23% during the cycle, a month on month drop of 0.54%, and a year-on-year drop of 21.65%. The domestic MTBE market shows a trend of first rising and then falling. In the first half of the week, prices rose mainly due to the concentrated delivery of some shipping orders and high enthusiasm for downstream procurement. However, in the second half of the week, the market rose to a high level and transactions cooled down, resulting in a clear weakening of the atmosphere and an increase in low-priced offers. The domestic MTBE market is weakly consolidating.

In terms of cost and crude oil, the rise in international oil prices is mainly due to the improvement of some economic data in Asia, which to some extent boosts market confidence in the demand outlook, coupled with the ongoing instability in the Middle East situation. As of October 25th, the benchmark price of Brent crude oil from SunSirs was $74.96 per barrel, an increase of 4.55% compared to the beginning of this month ($71.70 per barrel).

From the perspective of demand and downstream gasoline terminal demand, as temperatures in northern regions decrease and private car travel increases, retail gas station shipments remain stable. Most gas station merchants maintain medium to high inventory levels for procurement and sales, and operators may maintain their demand for MTBE or essential purchases. Short term MTBE demand is influenced by bearish factors.

Supply side: The construction of Jinjiang Oil and Chemical Plant and Shandong Chengtai Plant has affected production, while the construction of Yulong Petrochemical's new plant has led to an increase in plant operating rate. Short term domestic MTBE supply is affected by bearish factors.

As of the close on October 24th, the closing price of the Asian MTBE market has increased by $2/ton compared to the previous trading day, with FOB Singapore closing at $747.99-749.99/ton. The closing price of the European MTBE market decreased by $4.75/ton compared to the previous trading day, and FOB ARA closed at $858.74-859.24/ton. The closing price of the MTBE market in the United States decreased by $4.32/ton compared to the previous trading day, and the FOB Gulf offshore price closed at $735.13-735.49/ton (207.57-207.67 cents/gallon).

In the future, it is predicted that the supply of MTBE resources will increase slightly, but the demand will be weak, and manufacturers will accumulate inventory. MTBE analysts from SunSirs believe that the domestic MTBE market will consolidate and operate in the short term.

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