According to SunSirs, the dichloromethane market in the second half of August broke the pattern of continuous decline seen in the first half, exhibiting significant volatility: prices first bottomed out and rebounded, then surged before pulling back slightly. As of August 28, the mixed price for bulk dichloromethane in the Shandong region stood at 2,372 RMB/ton, up 21.98% from mid-month levels; however, following this price surge, downstream buying interest proved insufficient, and actual transactions were largely negotiated on a case-by-case basis.

Analysis of Market Drivers

Supporting Factors (Bullish):

Cost-side support: Geopolitical disruptions have pushed up methanol prices, while tightening supplies of liquid chlorine have led to a slight rise in its price; these factors have directly increased the production cost of dichloromethane, providing a floor for its price.

Supply-side contraction: Some manufacturers are conducting facility maintenance or reducing operating rates. Overall finished-product inventories at factories remain manageable, and manufacturers show a strong willingness to support prices; a reluctance to sell is providing a degree of price support.

Factors Constraining Prices (Bearish):

Weakness on the demand side: The downstream refrigerant sector (e.g., R32) is nearing the end of its production cycle, with purchasing limited to essential needs and no significant restocking activity. Traditional sectors, such as pharmaceutical solvents, are in their off-season; insufficient demand growth and downstream pressure to lower prices are capping the potential for price increases.

Market Outlook

Short-term: The dichloromethane market is likely to continue fluctuating within a narrow range. If upstream units undergoing maintenance resume production, the cost support provided by raw materials will weaken as the supply of liquid chlorine is restored. Meanwhile, as the peak season for the refrigerant industry draws to a close, downstream demand is unlikely to see a significant surge; consequently, there is considerable resistance to further sharp price increases, and the market is expected to focus on consolidating previous gains while trading within a narrow band.

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