China's domestic DMF market is projected to exhibit low-level narrow fluctuations in 2026, with mainstream prices hovering around CNY4,000 per ton. The overall fluctuation range is expected to narrow further compared to this year, with prices unlikely to exceed CNY500 per ton. Under the dual pressures of cost support and supply-demand dynamics, the probability of DMF prices breaking above RMB 4,500/ton or below RMB 3,500/ton remains low. Short-term price fluctuations will primarily be influenced by maintenance and restart schedules at DMF plants, as well as temporary shifts in supply-demand balance driven by large export orders or bulk tenders from major downstream enterprises.

I. Macroeconomic Outlook

Looking ahead to 2026, global economic growth is projected to decelerate further amid heightened policy uncertainties, rising protectionism, and accelerated technological transformation, stabilizing at 3.3%. China is expected to maintain moderate growth around 5.0%, with deflationary pressures persisting. For the chemical market, supply pressures remain significant, while weak demand shows little sign of substantial improvement. External factors like trade policies and geopolitical tensions continue to introduce instability into commodity markets. With demand for major commodities remaining sluggish, commodity prices are likely to stay under downward pressure.

II. Raw Material Level

Methane: With limited net supply growth and moderate demand expansion, China's methane market in 2026 will see volatility driven primarily by internal market dynamics. Key factors include diverging trends between coastal ports and inland regions, along with periodic supply-demand imbalances stemming from regional fundamental shifts. While price levels in certain areas may rise compared to the previous year, multiple risks could suppress prices or trigger volatility.

Synthetic Ammonia: China's synthetic ammonia market is projected to maintain a trend of ample supply and steady demand growth in 2026. Following minor capacity adjustments, total production capacity will remain at elevated levels, prolonging the supply-demand imbalance. Seasonal price fluctuations will diminish, Price fluctuations within 2026 are expected to narrow further. Additionally, international markets face pressure from maintenance and new capacity additions in the Middle East (e.g., Oman) expected to resume or start production in 2026. Increased global output will hinder expansion of China's export market. With both domestic and international pressures converging, prices in major production areas are likely to ease further. The synthetic ammonia market is projected to continue operating in a weakening trend with volatility in 2026, with prices expected to decline further compared to 2025.

Overall, price fluctuations for methanol and synthetic ammonia—key DMF feedstocks—will remain limited in 2026, potentially easing cost pressures. Current DMF plant prices fluctuate modestly near cost levels, suggesting increased influence of costs on future market trends, though the overall impact remains limited. DMF price movements will primarily reflect shifts in supply-demand fundamentals.

III. Supply-Demand Fundamentals

China's DMF industry is projected to remain in a supply surplus in 2026. Although no new capacity is expected to come online next year, existing capacity already far exceeds total domestic demand. With industry operating rates stabilizing, spot market supply is anticipated to remain largely unchanged from this year. On the demand side, the pulp industry—DMF's primary downstream sector—also faces overcapacity, making significant growth unlikely. Operating rates in this sector remain at low-to-medium levels. The pharmaceutical sector maintains steady demand growth, while other industries show limited expansion potential. Consequently, demand growth is unlikely to significantly exceed this year's levels. The supply-demand structure for DMF is expected to remain challenging next year, sustaining a fragile equilibrium.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.