SunSirs: Multiple Benefits, China MTBE Market Fluctuated and Rose in September

According to the Commodity Market Analysis System of SunSirs, the domestic MTBE market is fluctuating and rising. From September 1st to 25th, the price of MTBE increased from 7,837 RMB/ton to 8,050 RMB/ton, with a price increase of 2.71% during the cycle and a year-on-year increase of 11.65%.

At the beginning of the month, with the support of positive factors such as the rise in crude oil and the signing of a large number of export orders, some manufacturers began to export to the port, resulting in a tightening of resource supply. Manufacturers actively pushed up their prices. After the price rose to a high level, downstream resistance increased, and the market slightly corrected and reorganized, but the extent was limited. Subsequently, supported by the rise in crude oil, the price situation pushed up again.

In the first half of the month, the rise in crude oil prices was driven, coupled with the bottoming out of export orders, causing domestic MTBE manufacturers to hold low inventory and have little pressure to sell, leading to an upward trend in the market.

In mid month, the continuous decline in international crude oil prices has affected the oil market, and the domestic MTBE market lacks support for demand, resulting in a downward trend in prices; However, the external market prices have continued to rise, with a large number of export orders signed since the weekend, which has supported the mentality of domestic businesses. At the same time, Lihuayi devices have been repaired on schedule, resource supply has been reduced, and the MTBE market has seen a narrow upward trend.

In the latter half of this month, export orders were gradually signed in the Shandong region, providing strong support for the domestic market. At the same time, as the National Day holiday approaches, terminal businesses are moderately restocking, and the trading atmosphere is good. The current retail prices in China are also facing an increase. Overall, the domestic MTBE market is stable and rising, and prices are firm and worry free.

On the cost side, the crude oil market continued to rise in September, with the international oil market showing a stronger trend, mainly due to expectations of supply tightening overshadowing concerns about slowing economic growth and increasing US inventories. The Petroleum Exporting Organization and its allies (OPEC+) have extended the deadline for production cuts, while leaders Saudi Arabia and Russia have extended their plans to cut crude oil supply by 1.3 million barrels per day until the end of the year. The significant continuous supply gap caused by the cuts may lead to tight crude oil supply in the fourth quarter, and institutions and investors are generally bullish on oil prices.

On the demand side, in terms of gasoline, domestic gasoline is supported by the strong cost of crude oil on the one hand, and on the other hand, it has entered the golden nine silver ten consumption peak season. With the arrival of the Mid Autumn and National Day holidays, downstream merchants have increased their replenishment mentality, and refinery inventory has remained low. Most manufacturers may stock up in advance, which is a combination of positive factors, and the domestic gasoline market continues to rise. The demand side of MTBE is influenced by favorable factors.

On the enterprise side, facilities such as Shenyang Wax Chemical, Lihuayi, and Yantai Wanhua are still in shutdown. After the start of shipment by Lushenfa, production continues to be affected, leading to an increase in production. On September 13th, the Dongying Qifa facility underwent maintenance, which is expected to last for one week. The MTBE supply side is mixed.

In terms of external trading, as of the close on September 22, the closing price of the Asian MTBE market has increased by $0.64/ton compared to the previous trading day, while FOB Singapore closed at $1,063.05/ton-$1,065.05/ton. The closing price of the European MTBE market increased by $2/ton compared to the previous trading day, while the FOB ARA closed at $1,545.99- $1,546.49/ton. The closing price of the MTBE market in the United States decreased by $69.44/ton compared to the previous trading day, while the FOB Gulf price closed at $1,398.97-1,399.33/ton (394.08-394.18 cents per gallon).

In the future market forecast, the current high price has hindered the profits of end-users, and there is a certain resistance towards high prices; Lihuayi heterogeneous device has a construction plan, so it is expected that resource supply will increase at that time. SunSirs MTBE analysts believe that there is a possibility of a narrow pullback in the domestic MTBE market in the short term.

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