SunSirs: China MTBE Market Continues to be Weak

The domestic MTBE market saw a narrow decline from May 13th to 21st, The MTBE price has dropped from 6,975 RMB/ton to 6,825 RMB/ton, with a 2.15% decrease in price during the cycle, a 9.75% decrease compared to the previous period, and a 9.00% decrease year-on-year. The domestic MTBE market continues to be weak and the decline has intensified. The international crude oil trend is weak, and the downstream gasoline market demand is not good. Business owners are more resistant to high priced gasoline raw materials, The MTBE factory encountered shipment obstacles, and with the resumption of work on some heterogeneous devices due to partial shutdown, The supply of MTBE resources continues to increase, and the downward trend of MTBE is more pronounced under the imbalance of supply and demand.

On the cost side, international crude oil: The overall narrow decline in international oil prices is mainly due to the positive progress in the ceasefire negotiations between Palestine and Israel, the easing of geopolitical tensions, and the still bearish outlook for global demand. As of May 10th, the settlement price of Brent crude oil futures main contract was $82.79 per barrel, a decrease of $1.09 or 1.3%.

On the demand side, international crude oil prices have fluctuated downward, and the market for refined oil products is weak and difficult to improve. The main reason is that the current performance of terminal demand is insufficient, social unit inventory needs to be further digested, downstream users purchase on demand, and market transactions are mainly small orders. Short term MTBE demand is influenced by bearish factors.

Supply side: Units such as Dongying Qifa, Minghao Chemical, Binzhou Jingbo, and Maoming Shihua are in shutdown, Qingzhou Tian'an unit is shut down, and Shandong Chengtai unit is operating, resulting in a decrease in overall production. Looking at next week, the start of the Shandong Chengtai plant will affect next week's production, and at the same time, the production plan for Qingzhou Tian'ancun may increase. Short term domestic MTBE supply is affected by bearish factors.

As of the close on May 20th, the closing price of the Asian MTBE market has increased by $10 per ton compared to the previous trading day, FOB Singapore closed at 895.99-897.99/ton. The closing price of the European MTBE market has decreased by $2.25 per ton compared to the previous trading day, FOB ARA closed at $993.74-994.24 per ton. The closing price of the US MTBE market has decreased by $12.17 per ton compared to the previous trading day, The FOB Gulf price closed at 965.56-965.91 US dollars per ton (271.99-272.09 US cents per gallon).

According to future predictions, the overall operating rate of the equipment is currently high, and the situation of abundant domestic resource supply continues. The expectation for a new round of retail price restrictions on gasoline has been lowered, and there is currently no holiday travel to boost demand for MTBE. SunSirs MTBE analysts believe that the domestic MTBE market may continue to be weak in the short term.

If you have any questions, please feel free to contact SunSirs with support@sunsirs.com.