SunSirs: China MTBE Market Continues to Decline

https://www.chemnet.com   Oct 21,2024 SunSirs

According to the Commodity Market Analysis System of SunSirs, from October 14th to 18th, MTBE prices fell from 5,525 RMB/ton to 5,412 RMB/ton, with a price drop of 2.04% during the cycle, a month on month drop of 5.21%, and a year-on-year drop of 28.55%. The domestic MTBE market as a whole is showing a fluctuating downward trend. In terms of international crude oil, the risk of conflict between Iran and Israel has significantly weakened, and OPEC and the International Energy Agency have successively lowered their global crude oil demand growth forecasts. The closing price of crude oil continues to decline, which greatly suppresses the mentality of industry players. However, the terminal demand for gasoline is weak, and industry players maintain on-demand purchase of MTBE, causing the MTBE market price to continue to decline.

On the cost side, in terms of crude oil: the international oil price has fallen, and the main negative factors are: the risk of conflict between Iran and Israel has significantly weakened, and OPEC and the International Energy Agency have successively lowered their global crude oil demand growth forecasts. As of October 18th, the benchmark price of Brent crude oil from SunSirs was $74.22 per barrel, an increase of 3.51% compared to the beginning of this month ($71.70 per barrel).

On the demand side, in terms of downstream gasoline terminal demand, as the frequency of private car trips by the public decreases, the performance of retail gas station shipments is flat. Gas station merchants purchase on demand in addition to their inventory, mostly maintaining a median inventory operation. Operators may purchase relevant gasoline raw materials on demand. Short term MTBE demand is influenced by bearish factors.

Supply side: The commencement of production at Jinjiang Oil and Chemical Plant and Shandong Chengtai Plant may affect output, and there may be expectations of a narrow increase in resource supply. Short term domestic MTBE supply is affected by bearish factors.

As of the close on October 17th, the closing price of the Asian MTBE market has increased by $9.5 per ton compared to the previous trading day, with FOB Singapore closing at $742.99-744.99 per ton. The closing price of the European MTBE market decreased by $19/ton compared to the previous trading day, and FOB ARA closed at $837.49-837.99/ton. The closing price of the MTBE market in the United States decreased by $2.84/ton compared to the previous trading day, and the FOB Gulf offshore price closed at $741.54-741.9/ton (209.38-209.48 cents/gallon).

In the future, it is predicted that the supply of MTBE resources will increase slightly, but the demand for gasoline will weaken. In addition, due to the continuous poor shipment in the early stage and the accumulation of manufacturer inventory, MTBE analysts from SunSirs believe that the domestic MTBE market will still be weak in the short term.

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