SunSirs: Energy, LNG Rose in February

Price Trend

According to the data monitoring of SunSirs, the average price of LNG on February 1 was 3,090 RMB/ ton, and the average price at the end of the month (February 29) was 3,053.33 RMB/ ton, down 1.19% in the month, 30.71% compared with the same period last year. On March 5, the LNG commodity index was 75.67, up 0.25 points from yesterday, down 63.79% from 208.96 (2017-12-25), the highest point in the cycle, and up 9.91% from 68.85, the lowest point on October 7, 2019. (Note: cycle refers to 2012-09-01 to now)

Analysis of Influencing Factors

Products: according to the data monitoring of SunSirs, as of March 5, the LNG price of Inner Mongolia ErdosXingxing Energy Co., Ltd. was 3,100RMB/ton, and that of Inner Mongolia EtokQianqiShitai Natural Gas Co., Ltd. was 3,030RMB/ton. The LNG price of Zizhou LNG plant of Shaanxi Lvyuan Natural Gas Co., Ltd. was 3,130 RMB/ton, that of Xinjiang Guanghuinaomao Lake (east of Lanzhou) was 2,320 RMB/ton, that of Shanxi QinshuiXinaowas 3,370 RMB/ton, and that of Shaanxi Zhongyuanlvneng Natural Gas Co., Ltd. was 3,080 RMB/ton. The price of LNG varies in different places.

Market analysis: the overall trend of LNG in February was up and down. Since February, the trend of LNG has been poor, falling continuously. Affected by public health events, most of the downstream plants have been delayed to start, traffic control is strict, some liquid plants have been shut down and production has been reduced, and liquid prices have been declining. Since the middle of February, all regions began to return to work one after another, with a certain increase in demand. However, due to the impact of poor shipment, the liquid level of LNG plants increased, LNG plants actively discharged the storage, the market breadth fell, and the low level remained stagnant. February 17-24 rose 6.33% in a row, bringing a brief market. Near the end of the month, with the sharp decline of crude oil and liquefied gas market, there is a certain impact on LNG. In addition, with the increase of start-up of manufacturers, the production is gradually increasing, and the supply of goods is sufficient. After the price is raised in the early stage, the volume of transactions is not as expected, and the inventory is increasing. The liquid plants follow the market, and successively reduce the prices. At the end of the month, LNG prices end in a decline.

Market Analysis: the overall trend of LNG in February was up and down. Since February, the trend of LNG has been poor, falling continuously. Affected by public health events, most of the downstream plants have been delayed to start, traffic control is strict, some liquid plants have been shut down and production has been reduced, and liquid prices have been declining. Since the middle of February, all regions began to return to work one after another, with a certain increase in demand. However, due to the impact of poor shipment, the liquid level of LNG plants increased, LNG plants actively discharged the storage, the market breadth fell, and the low level remained stagnant. February 17-24 rose 6.33% in a row, bringing a brief market. Near the end of the month, with the sharp decline of crude oil and liquefied gas market, there is a certain impact on LNG. In addition, with the increase of the start-up of the manufacturer, the production gradually increases, and the supply of goods is sufficient. After the price is raised in the early stage, the volume of transactions is less than expected, and the inventory has increased. The LNG plant successively adjusts the quotation, and the LNG price at the end of the month ends with a decline.

Industry: according to the price monitoring of SunSirs, there were 3 kinds of commodities in the rise and fall list of bulk commodity prices in February 2020, among which one is more than 5%, accounting for 6.3% of the monitored commodities in the energy sector; the top 3 commodities weree petroleum coke (26.38%), thermal coal (2.09%) and coking coal (0.79%). There were 12 kinds of commodities falling on a month on month basis, and 7 kinds of commodities falling by more than 5%, accounting for 43.8% of the number of commodities monitored in the sector; the top three products falling were LPG (-15.59%), MTBE (-15.56%), DME (-10.08%). This month's average rise and fall was -3.68%.

Market Forecast

According to the LNG analysts of SunSirs, in March, the LNG market showed a mixed situation, with some LPG prices in the North rising slightly and those in the South falling. At present, the competition between land and sea is encouraging. Under the impact of imported low-cost gas, domestic gas is afraid of insufficient power to rise. It is expected that the market will mainly consolidate in the short term.

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