SunSirs: The Overall Operation of the Dichloromethane Industry has Rebounded to Around 80%

Price trend

Prices fell after the Dragon Boat Festival: After the Dragon Boat Festival, the enthusiasm of downstream and traders in the Shandong market to accept orders slowed down. Although some devices were reduced for maintenance, the market supply was loose, and the holders were dominated by shipments. On the 10th, dichloromethane fell to a low point in a week, a drop of 7.78%, a year-on-year drop of 12.68%.

Low-level rebound: As prices weakened, the market demand for replenishment at low prices increased, and trading activity increased. According to the monitoring of the commodity market analysis system of SunSirs, as of June 11, the average price of dichloromethane bulk water in Shandong was 2,175 RMB/ton, a weekly drop of 6.05%, a year-on-year drop of 7.45%.

Analysis of influencing factors

Supply side: Individual enterprises reduce load and stabilize prices, and the overall supply is still relatively loose

Device dynamics: The overall operation of the industry has rebounded to about 80%, and the supply is relatively stable. At present, some enterprises have reduced load and stabilized prices. Among them, Shandong Luxi is operating at low load, Jiujiang Jiuhong is operating at half load, and Jiangsu Fuqiang is operating at 80%.

Inventory pressure: Some manufacturers have accumulated inventory, and destocking is the main focus after the holiday, which has led to price pressure.

Cost side: Methanol rebounds, liquid chlorine fluctuates upward

Methanol: The supply is relatively loose. At present, methanol has increased domestically and reduced imports. Port inventory has accumulated but shipments are still acceptable. Methanol prices have bottomed out and rebounded. As of June 11, the spot price of methanol in SunSirs was 2,360 RMB/ton, an increase of 4.89% during the week. It is expected that the arrival of port imports will continue to increase, and the accumulation of inventory will continue.

Liquid chlorine: The price of liquid chlorine in Shandong has fluctuated and rebounded, providing some support for the cost of dichloromethane.

Demand side: As an important organic solvent and chemical raw material, dichloromethane is widely used in refrigerants, pharmaceuticals, coatings, adhesives, electronic cleaning and other fields. Most of them are purchased on dips and just-needed basis.

Refrigerants are still in the peak season of demand, and prices continue to rise steadily. R32 (mainly used for household and commercial air conditioners), the current domestic average price has exceeded the 50,000 RMB mark per ton, a year-on-year increase of 42%. However, most companies produce their own raw material dichloromethane, and the proportion of external purchases is relatively small. Due to quota restrictions, the industry's incremental space is limited, and support for dichloromethane is weak.

The coating and adhesive industries have a seasonal recovery, and entered the peak season for construction and decoration in June. Demand has improved month-on-month, but affected by environmental protection policies, some companies have turned to low-VOCs solvents.

The electronic cleaning industry has benefited from the stocking of new energy vehicles, energy storage and consumer electronics, and the demand for high-purity DCM has grown steadily.

Pharmaceutical industry: Just-needed demand is stable, but some companies are exploring alternatives under high environmental protection standards.

Outlook for the future market

Due to the game between cost support and loose supply, dichloromethane will fluctuate and consolidate in the short term. If the coatings, electronics and other industries continue to replenish inventory, the price may rebound slightly; if the wait-and-see sentiment in the downstream increases, it is not ruled out that it will bottom out again.

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