SunSirs: Off Season is Not Light, LNG Market Goes Up in May

1. Price trend

According to the data monitoring of SunSirs, the average price of domestic liquefied natural gas on May 31 was 3593.33 RMB/ton, which was 536 RMB/ton higher than 3056.67 RMB/ton at the beginning of the month, with an increase rate of 17.56% in the month and the maximum amplitude of 28.2% in the month, with an increase of 46.83% compared with the same period last year.

2.Analysis of influencing factors

In May, the domestic liquefied natural gas market rose sharply, with a year-on-year increase of about 46%, showing remarkable performance in the off-season period of consumption. It can be roughly divided into three stages: rapid rise in the first half of the month, continuous decline in the second half of the month, slight rebound near the end of the month, and overall price trend of rise fall rise. At the end of the first holiday, the restrictions on the transportation of high-speed dangerous chemicals were lifted, the demand for vehicles increased after the holiday, the maintenance of superimposed liquid plants increased, the supply was tightened, the inventory of enterprises was low, and the price of imported gas rose, which led to the straight-line rise of domestic liquid price. However, the rally lasted for a short time. After reaching its peak in the middle of this month, it began to decline gradually. Along with the simultaneous decline of several commodity prices, some of the gains in the first half of the month were recovered and fell back to the cost line for a time. Near the end of the month, the price of feed gas rose to 1.96-1.98 RMB/m³, and the cost support was enhanced. In addition, the demand in southern China increased, the maintenance of liquid plants and the import gas continued to rise. The favorable factors boosted the price of liquid again.

In June, the domestic liquefied natural gas market continued to rise, but the off-season demand was limited and the increase was not large. On June 2, Inner Mongolia region 3,450-3,650 RMB/ton, Shaanxi region 3,560-3,720 RMB/ton, Shanxi region 3,650-3,770 RMB/ton, Ningxia region 3,600-3,700 RMB/ton, Henan region 3750-3900 RMB/ton, Hebei region 3540-3850 RMB/ton, all liquid prices rebounded slightly.

Liquefied natural gas prices go up, driving the overall upward trend of downstream products:

Methanol, June 2 methanol futures on Zhengzhou Commodity Exchange fell sharply, closing at 2,506 RMB/ton, down 49 RMB/ton, or 1.92% from the last trading day. The methanol spot market is mainly shaken and sorted out, and some regions are slightly reduced. According to the monitoring of SunSirs, as of June 2, the average price of domestic methanol production enterprises in Shandong was 2632 RMB/ton, with a month-on-month increase of 2.83% and a year-on-year increase of 64.02%. SunSirs methanol analysts expect the short-term methanol market to enter a high finishing stage.

Urea, June 2, Shandong urea market rose, demand: agricultural demand rose; Affected by the mentality of buying up but not buying down, the downstream compound fertilizer and rubber sheet factories took goods actively, and the new orders of enterprises followed up well. Supply-side: some urea plants shut down for maintenance, and the supply side is tightened. Enterprises have a strong attitude toward supporting prices. It is expected that the ex-factory price of urea in Shandong will rise slightly in the future.

Dichloromethane, in May, the dichloromethane market rose first and then fell, the overall upward. According to the monitoring data of the SunSirs, the price of dichloromethane was 3630 RMB/ton at the beginning of the month, then rose to 4263 RMB/ton on May 17, and dropped to 3833 RMB/ton at the end of the month. Overall, the end of the month was 5.60% higher than the beginning of the month. At present, the risk of the domestic dichloromethane market has been released in the early stage. At present, the cost side, supply side, and demand-side are all supported. It is expected that the price of dichloromethane will be high and firm shortly.

3. Future forecast

Analysts of the LNG of SunSirs believe that: in June, the price of gas source rose, the cost support gradually increased, and the imported gas was added up, which boosted the atmosphere of the domestic liquid market. Meanwhile, the demand in the south area was increased. In addition, the liquid price in the early stage fell to a low level, and the manufacturers had a strong willingness to support the market and actively followed up, but the off-season factors affected it, which made it difficult to form a turning point, is expected that the rise of LNG market may slow down and tend to be stable in the short term.

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