Price trend

According to the commodity price analysis system of SunSirs, as of December 9th, the average price of bulk dichloromethane in Shandong province was 1,685 RMB/ton, remaining unchanged from the beginning of the month, but a significant decrease of 45.56% compared to the same period last year. This highlights that the market was at a historical low price level and is under severe overall pressure.

During the first week of December, the market as a whole remained in a consolidation and wait-and-see mode. Companies offered competitive pricing to move inventory over the weekend, and downstream buyers replenished their stocks moderately. Recently, some facilities in the region reduced production or indicated intentions to do so, strengthening companies' willingness to maintain stable prices. As of November 9, the ex-factory price in Shandong had risen to 1,640-1,670 RMB/ton, showing a narrow upward adjustment trend.

Supply side: Although the load was high, localized reductions in load provided support

The industry's operating rate remained high at approximately 85%, resulting in ample overall supply. However, some facilities in Shandong province recently reduced production or planned to do so, coupled with varying inventory pressures among companies, leading to a slight easing of supply pressure and a stronger willingness among companies to maintain stable prices.

Demand side: Continued weakness suppressed the upward room for price

Despite low prices, downstream buyers and traders remain reluctant to purchase, mostly buying only as needed, making it difficult for prices to sustain an upward trend. Market transactions were primarily driven by essential needs, and there were no clear signs of improvement in demand.

Cost side: Raw material price trends were diverging, with liquid chlorine providing significant support

Liquid chlorine: Downstream demand was stable, and prices in the Shandong region remained high, becoming a key cost support factor.

Methanol: Market restocking had slowed down, and import expectations had increased, leading to price fluctuations and a generally weaker trend, which partially eased cost pressures. As of December 9th, SunSirs' benchmark price for methanol was 2,090 RMB/ton, a decrease of 1.42% during the period.

Market Outlook: In the short term, the market is expected to remain stable with narrow fluctuations, and both upside and downside potential are limited

Supporting factors: High liquid chlorine costs, production cuts by some companies leading to localized supply adjustments, and a clear intention from companies to maintain stable prices.

Constraining factors: Overall industry operating rates remain relatively high, while end-user demand remains weak, which will limit the extent of any price rebound.

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