SunSirs: Weak Consolidation of Domestic Lliquefied Gas Market in August

1. Price Trend

Domestic liquefied petroleum gas (Shandong) market tumbled in August. At the beginning of the month, the average price of domestic liquefied gas market was 3733.33 yuan/ton, and at the end of the month, it was 3730 yuan/ton. The price fell by 0.09% in the month, which was 20.79% lower than that of the same period last year.

2. Analysis of Influencing Factors

Products: In August, the domestic liquefied petroleum gas market price fluctuated narrowly and overall downward. As of August 30, the ex-factory price of liquefied gas of Sinopec Guangzhou Branch was 3180 yuan/ton, that of Sinopec Jingmen Branch was 3450 yuan/ton, that of Sinopec Shanghai was 3310 yuan/ton, that of Sinopec Qingdao was 3390 yuan/ton, that of Sinopec Shijiazhuang was 3500 yuan/ton and that of Sinopec Luoyang was 3600 yuan/ton.

In August, the liquefied petroleum gas (Shandong market) shocks were mainly narrow adjustment. International crude oil prices still have a greater impact on the liquefied petroleum gas market. In early August, liquefied petroleum gas prices continued to be low, At the beginning of August, the price of liquefied petroleum gas continued to be low, and the downstream market was active, factory shipments were smooth, no pressure on inventory, and then price boosted. However, limited by the decline in international crude oil, the increase was not significant. In mid-August, the typhoon affected the production and transportation, blocked shipment for several days and prices fell. Then the bad weather weakened, shipments returned to normal, inventories eased, and international crude oil pushed the market higher. However, due to the limited increase in demand, coupled with the expected fall in September CP, downstream bearish on the future market, the enthusiasm to enter the market weakened. The factory shipment of the returned to dull, and the price fell again at the end of August. Before September CP was introduced, the price of propane has fallen but the range is less than expected, which has eased the market mentality and slightly increased the price.

Industry chain:

The domestic dimethyl ether market continued to decline in August. At the beginning of August, the profit of dimethyl ether Market was relatively high. Some manufacturers began to produce and the market supply increased. However, the terminal demand was slow, the contradiction between supply and demand was prominent, and the price fell mainly.

In August, the propane Market rose slightly, mostly with shocks.

Industry: According to SunSirs, in August 2019, there were five kinds of commodities rising in the energy sector, one of which had increased more than 5%, accounting for 6.3% of the monitored commodities in the sector; the top three commodities were MTBE (8.16%), gasoline (2.24%) and methanol (1.22%). There were 11 kinds of commodities with a decline of more than 5%, accounting for 25% of the monitored commodities in this sector. The products with the first three declines were dimethyl ether (-9.03%), liquefied natural gas (-7.08%) and Brent crude oil (-6.28%). August average rise and fall was -1.52%.

3. Future Market Forecast

SunSirs Liquefied gas analysts believe that the traditional sales season is approaching, the demand for liquefied gas market is rising, coupled with the Mid-Autumn Festival approaching, the downstream inventory expectations before and after the festival, the price is expected to stabilize and then rise in September.