SunSirs: DME Market Falls and Rises, Rising in "Dilemma" in 2020

According to the data of SunSirs, in 2020, China domestic DME Market is mainly volatile. SunSirs selects Henan as a reference. The average price of DME at the beginning of the year was 3,116.67 RMB/ ton, and at the end of the year was 3,340.00 RMB/ ton, up 7.17% in the whole year. In 2020, the highest price of DME appeared on January 21 and December 21, with an average price of 3,340.00 RMB/ ton. The lowest price appeared on June 22, with an average price of 2 193.33 RMB/ ton. The maximum earthquake amplitude of the whole year was 34.33%. At the end of the year (December 21), the price had already exceeded the level at the beginning of the year and remained flat compared with the highest point in the year.

After the New Year's Day and before the Spring Festival in 2020, the DME market continues the upward trend at the end of 2019. Before the Spring Festival, international crude oil continued to rise, supporting the domestic gas prices. In addition, Saudi Aramco's CP price rose sharply in January, which promoted the continuous upward trend of domestic gas. Dimethyl ether was boosted by this positive, the price continued to rise. However, DME did not keep up with the decline, but continued to rise, with the price reaching the highest point in the year until the Spring Festival.

The downward channel was opened after the Spring Festival. Due to the decrease of terminal demand, the market began to explore the bottom. Affected by the international public health events, the Spring Festival holiday was extended, the traffic and transportation in all cities were closed, the downstream was in a state of full shutdown, and the terminal demand was greatly reduced. Although the operating rate of DME was at a low level, the transaction atmosphere was light and the market was still in the situation of oversupply. In addition, affected by the decline of international crude oil, the overall trend of LPG civil gas was weak, and the price difference between gas and ether was gradually narrowing, which makes the DME Market "worse", and the price fell again and again.

In mid July, due to the continuous rise of the LPG civil market and the favorable market mentality, the enthusiasm of downstream market entry improved and the market transaction atmosphere improved. As the traditional off-season did not pass and the terminal demand did not follow up, the market returned to a weak position and the price fell to the level before the rise.

From September, with the arrival of the traditional sales peak season, the DME market began to rise. Due to the sharp rise of raw material methanol and strong cost support, DME manufacturers took advantage of the situation to push up the price. Downstream entered the market more actively, manufacturers shipped smoothly, prices continued to push up. And the international crude oil ushered in a sharp rebound, the trend of methanol cost was strong, there were many favorable factors in the market, and the price of DME continued to be dominant by an upward trend.

After November, the DME market rose again and the price rose broadly. Under the strong support of the rising raw materials, the price of DME Market rose. In the middle of November, it broke through the 3,000 RMB/ ton mark. In the last ten days, it was mainly consolidation, which was around 3,000 yuan/ ton.

At present, 2020 is coming to an end. With the support of the rising cost of methanol and LPG civil market, the rise of market price will not decrease, and the ex-factory price will be raised in succession, or the year 2020 will end with price increase. In terms of overall demand, this year is greatly affected by the world public health events. It is expected that the demand of next year will be better than this year, and the overall price may be higher than this year. In 2021, it may be an "N" trend. However, more attention should be paid to methanol and civil gas.

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