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SunSirs: China MTBE Market Declined in Narrow Range

https://www.chemnet.com   May 13,2024 SunSirs

  The domestic MTBE market has experienced a narrow decline. From May 6th to 11th, the price of MTBE dropped from 7,325 RMB/ton to 7,050 RMB/ton, with a price drop of 3.75% during the cycle, a month on month decrease of 6.00%, and a year-on-year decrease of 5.37%. After the holiday, the MTBE market was mainly volatile and rebounded, with downstream businesses having less enthusiasm for replenishing inventory than expected. Business owners remained relatively resistant to high priced gasoline raw materials and had average purchasing enthusiasm. During the holiday period, the Asian MTBE market experienced a broad decline, with few new export orders signed. Business owners had a strong bearish atmosphere, and the MTBE market operated weakly.

  On the cost side, international crude oil: The overall narrow decline in international oil prices is mainly due to the positive progress in the ceasefire negotiations between Palestine and Israel, the easing of geopolitical tensions, and the still bearish outlook for global demand. As of May 10th, the settlement price of Brent crude oil futures main contract was $82.79 per barrel, a decrease of $1.09 or 1.3%.

  On the demand side, in terms of gasoline, international crude oil prices have fallen, while the refined oil market in Shandong region has fluctuated downward. The main reason is that during the May Day holiday, due to poor road transportation and some users stocking up in moderation before the holiday, the market buying and selling atmosphere was weak. However, although there has been a brief restocking since the holiday, the lack of terminal demand has led to a short period of good times. As the pace of mid to downstream merchants entering the market for procurement slows down, the overall shipment of refineries is not smooth. Refinery personnel can only attract customers to buy at low prices through price reduction promotions. The gasoline market is operating weakly, and operators are cautious in purchasing MTBE, mainly buying on demand. Short term MTBE demand is influenced by bearish factors.

  Supply side: Device maintenance gradually resumes and production increases

  As of the close on May 10th, the closing price of the Asian MTBE market has increased by $2/ton compared to the previous trading day, and FOB Singapore closed at $882.99-884.99/ton. The closing price of the European MTBE market has increased by $16/ton compared to the previous trading day, while the FOB ARA closed at $1,020.74-1,021.24/ton. The closing price of the US MTBE market has decreased by $15.12 per ton compared to the previous trading day, while the FOB Gulf offshore price closed at $887.03-887.38 per ton (249.87-249.97 cents per gallon).

  In the future, it is predicted that Qingzhou Tian Installation has plans to start construction, and the supply of resources will further increase. In terms of gasoline, the zero limit price will be lowered significantly, and the positive demand will be limited. The enthusiasm of operators for gasoline raw material procurement is not good, and MTBE is currently at a high price, with a strong mentality of terminal resistance. SunSirs MTBE analysts believe that the domestic MTBE market may further decline in the short term.

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