SunSirs: China MTBE Market fluctuated and rose in July

According to the Commodity Market Analysis System of SunSirs, the domestic MTBE market is fluctuating and rising. From July 1st to 27th, the price of MTBE increased from 7,087 RMB/ton to 7,562 RMB/ton, with a price increase of 6.70% during the cycle, with a maximum amplitude of 7.23% and a year-on-year increase of 1.92%.

At the beginning of the month, the international crude oil market was supported, and traders actively increased their prices. Production enterprises repeatedly raised their factory quotes, with a total increase of 300-500 RMB/ton. However, the downstream acceptance capacity was average, and the MTBE market price immediately declined.

In mid month, the international crude oil market was supported, with production companies Lihuayi and Shenchi exporting to the port. At the same time, Shouguang Luqing had no export sales, and Dongming Qianhai had internal transfers for some time. Most manufacturers had a large number of early orders, so the supply of goods was temporarily tight, and the MTBE market price immediately rose.

In the latter half of the month, Lihua Yiji Port was completed and turned into domestic sales, increasing domestic supply pressure. At the same time, the trend of the gasoline market was average, with poor terminal demand and a slight decrease in prices. After falling to a certain low point, there were a large number of transactions in the gasoline shipping list, combined with the increase in crude oil closing, terminal demand increased, and the MTBE market stopped falling and went up.

On the cost side, the crude oil market surged in July, and WTI crude oil reached its highest point in the past three months. The settlement price of the Brent crude oil futures main contract was $82.74 per barrel, an increase of $1.67 or 2.0%. The oil market has been boosted by the expected tightening of supply and continued fermentation, as well as the rebound in demand. As of July 26th, the Federal Reserve announced a 25bp interest rate hike, coupled with a lower than expected decline in US crude oil inventories, resulting in profit taking in crude oil futures and pressure on prices.

On the demand side, in terms of gasoline, there may be room for international oil prices to decline. Under the continuous positive impact of the lack of news, the refined oil market in Shandong Province is gradually returning to the supply and demand level. The gasoline market is supported by strong demand in the summer, and downstream users purchase on demand. The market trading atmosphere is mild, and the MTBE demand side is biased towards positive factors.

In terms of external trading, as of the close on July 26th, the closing price of the Asian MTBE market has decreased by $4.59/ton compared to the previous trading day, while FOB Singapore closed at $955.99-957.99/ton. The closing price of the European MTBE market increased by $19/ton compared to the previous trading day, while the FOB ARA closed at $1,224.99- $1,225.49/ton. The closing price of the MTBE market in the United States increased by $19.42 per ton compared to the previous trading day, while the FOB Gulf price closed at $1,073.16-1,073.51 per ton (302.30-302.40 cents per gallon).

In the future market forecast, there will be an increase in supply, but the downstream gasoline market is bullish. SunSirs MTBE analysts believe that the domestic MTBE market may consolidate in the short term.

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