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SunSirs: Energy, LNG Fell 6% in Two Days after New Year's Day, and may Continue to Fall

January 08 2020 11:15:13     SunSirs (Selena)

1  Price Trend

After New Year’s Day, the decline of LNG continued. According to the data monitoring of SunSirs, the average price of LNG on January 2, 2020 was 3,716.67 RMB/ ton, and the average price on January 3 was 3,486.67 RMB/ ton, down 6.19% in two days, up 35.03% compared with the same period last year. On January 3, the LNG commodity index was 85.94, down 5.67 points from the day before, or 58.87% from 208.96 (2017-12-25), the highest point in the cycle, and 24.82% higher than 68.85, the lowest point on October 7, 2019. (Note: cycle refers to 2012-09-01 to now)

2  Analysis of Influencing Factors

Products: according to the data monitoring of SunSirs, as of January 3, 2020, the LNG price of Inner Mongolia Erdos Xingxing Energy Co., Ltd. was 3,490 RMB/ton, and that of Inner Mongolia Etok Qianqi Shitai Natural Gas Co., Ltd. was 3,470 RMB/ton. The LNG price of Xinjiang Qinghua Energy Group Co., Ltd. was 3,400 RMB/ton, that of Zizhou LNG plant of Shaanxi Lvyuan Natural Gas Co., Ltd. was 3,650 RMB/ton, that of Xinjiang Guanghui naomao Lake (east of Lanzhou) was 2,600 RMB/ton, that of Shanxi Qinshui Xinao was 3,600 RMB/ton, and that of Shaanxi Zhongyuan lvneng Natural Gas Co., Ltd. was 3,500 RMB/ton. The LNG price of Dazhou Huixin Energy Co., Ltd. was 3,800 RMB/ ton, and the price of LNG rose and fell in regions, and fell as a whole.

Market analysis: after New Year’s Day, the trend of LNG is still weak. On December 27, 2019 PetroChina auctioned, the price of raw materials decreased, and the pressure of manufacturers reduced, but the market was abundant in supply, and the inventory was in a high position, so the manufacturers continued to reduce prices and make shipments. Recently, there are rain, snow and heavy fog in many places in the north, LNG shipment is blocked, tank transportation is not smooth, and air pollution emergency response has been issued in many places, environmental protection "shutdown order" has affected the gas consumption of LNG industry in some areas, and there is no large-scale replenishment demand, pipeline gas is relatively abundant, and LNG price is under pressure. Earlier this year's new year, the industrial gas consumption will be reduced, the overall market trading is not prosperous, and under the guidance of downstream demand, the trading center will start to move down, and the market is weak and hard to change.

Industry: according to the price monitoring of SunSirs, there were nine commodities in the list of commodity prices rising and falling on January 3, 2020, among which the top3 commodities were petroleum coke (1.29%), MTBE (0.92%) and coking coal (0.45%). There were four kinds of commodities with a decline of more than 5% on a month on month basis, accounting for 6.3% of the number of commodities monitored in the sector; the top 3 products with a decline were LNG (-6.19%), DME (-0.50%) and diesel (-0.66%). The average price of this day was - 0.26%.

3  Market Forecast

According to the LNG analyst of SunSirs, there is no big gap in the market in the warm winter of this year, and the supply is abundant. As the end of 2019, the market demand is decreasing, some enterprises' maintenance is ending, the supply is picking up, and the imbalance between supply and demand is further aggravating. At present, the environmental protection is becoming increasingly strict, the severe weather pollution problem is severe, and the downstream demand is not boosted. It is expected that the LNG market will be in the future It will continue to bear pressure and make profit in shipment.


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