SunSirs: China MTBE Market Trend Is in Weak Consolidation

According to the Commodity Market Analysis System of SunSirs, from August 15th to 22nd, MTBE prices fell from 5,060 RMB/ton to 5,020 RMB/ton, with a price drop of 0.79% during the cycle, a month on month drop of 0.35%, and a year-on-year drop of 18.37%. The domestic MTBE market is experiencing weak fluctuations. Local large manufacturers have ended their export port consolidation, resulting in an increase in MTBE external sales and gradually abundant resource supply. However, the demand for gasoline terminals is not performing well due to negative factors such as weak crude oil. Operators are purchasing relevant gasoline components on demand, and MTBE manufacturers are offering discounts to promote sales.

On the cost side, in terms of crude oil: the international oil price has fallen, and the main negative factors are the positive signals released by the Russia Ukraine peace talks, which are expected to further ease the geopolitical situation and weaken support for oil prices. As of August 21st, the settlement price of Brent crude oil futures for the October contract was $67.67 per barrel.

On the demand side, in terms of downstream gasoline, crude oil is weak and volatile, and the expected retail price limit for this round has been lowered. As the summer is coming to an end, the frequency of public travel is beginning to decrease. The MTBE demand side is affected by bearish factors.

Supply side: MTBE manufacturers Haier Xi and Huizhou Yuxin in Henan have started production, which has affected this week's output and led to an increase in plant operating rates. The short-term domestic MTBE supply is affected by favorable factors.

As of the close on August 21st, the closing price of the Asian MTBE market has increased by $10.46 per ton compared to the previous trading day, with FOB Singapore closing at $664.91-666.91 per ton. The closing price of the European MTBE market increased by $10.75/ton compared to the previous trading day, and FOB ARA closed at $837.99-838.49/ton. The closing price of the MTBE market in the United States increased by $16.43/ton compared to the previous trading day, and the FOB Gulf offshore price closed at $784.36-784.71/ton (221.47-221.57 cents/gallon).

Currently, some manufacturers still have export support for the market, but as the summer season approaches its end and gasoline demand becomes weaker, MTBE analysts from SunSirs believe that the domestic MTBE market is mainly weak and consolidating.

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