SunSirs: Driven by Rising Costs, Dimethyl Carbonate Prices Surged Over 25% in Just Half a Month

Price trend

During the first half of March, the domestic dimethyl carbonate (DMC) market exhibited a trend characterized by an initial strong surge, followed by high-level consolidation and a subsequent pullback. Market offers were mixed; however, the release of overall bullish support was concentrated and robust. Most traders maintained firm, high-level quotations, while some merchants tentatively sought to negotiate sales; as bullish market sentiment gradually cooled, actual transaction volumes remained sluggish.

According to the SunSirs Commodity Market Analysis System, as of March 16, the average domestic price for industrial-grade dimethyl carbonate stood at 4,716.67 RMB/ton, marking a cumulative increase of 25.78% over the past half-month.

Key Drivers

Cost Factors: The Primary Force Driving the Uptrend

Tensions in the Middle East have sparked concerns regarding energy supplies, driving a sharp surge in international crude oil prices. This, in turn, has triggered rapid price hikes for two key raw materials—methanol and propylene oxide—causing cost pressures for dimethyl carbonate (DMC) manufacturers to escalate dramatically. Consequently, these enterprises have been compelled to significantly raise their quoted prices and, in a concerted move, suspend sales to hoard inventory—emerging as the primary driving force behind the current market rally.

Methanol: Supported by a confluence of factors—including lingering geopolitical disruptions, expectations of contracting imports, and a gradual recovery in downstream sectors—the market continues to trend upward. As of March 16, the price of methanol, as reported by SunSirs, stood at 2,840.83 RMB/ton—an increase of 29.13% since the beginning of the month—thereby providing strong cost-side support for dimethyl carbonate (DMC).

Propylene Oxide: The market was temporarily in a stalemate. On the supply side, production facilities were operating steadily; active plants were experiencing smooth shipments and low inventory pressure, while prices remained at elevated levels. As of March 16, the price of propylene oxide—as reported by SunSirs—stood at 10,016.67 RMB/ton, marking a 25.21% increase since the beginning of the month and further reinforcing cost support for dimethyl carbonate.

Supply Side: Temporarily tight, fueling price increases.

Major production facilities were operating normally, and overall industry operating rates remained stable, though there had been no significant increase in production capacity. Factory inventories were generally low; some manufacturers were fulfilling backlogged orders, and the pace of contract deliveries had slowed, resulting in a tight supply of spot market goods. Suppliers demonstrated a strong inclination to hold firm on pricing, while traders were withholding inventory in anticipation of price hikes—factors that were further intensifying the tightness in the spot market.

Demand Side: Dominated by Essential Needs; Strong "Wait-and-See" Sentiment

Overall demand was characterized by a weak recovery in essential purchasing, dampened procurement activity due to high prices, and sluggish transaction volumes. The battery sector stands out as the sole bright spot, while demand for traditional solvents and PC-related applications remains weak; consequently, overall market support for high price levels is limited. Activity is primarily driven by small, sporadic orders and "as-needed" inventory replenishment, with no signs of centralized bulk purchasing or speculative stockpiling. Amidst high price levels, downstream players maintain a strong "wait-and-see" stance and demonstrate little willingness to chase rising prices.

Market outlook

Demand-side conditions are unlikely to see significant improvement; the dampening effect of high prices on downstream sectors continues to manifest, leaving the market devoid of sustained upward momentum. On the cost side, heightened volatility persists, and the pricing support provided by suppliers may gradually weaken. Consequently, the dimethyl carbonate (DMC) market is expected to experience high-level fluctuations with a downward bias during the latter half of March, carrying a risk of price retracement. Key factors to monitor include trends in raw material markets, changes in factory inventory levels, and the actual follow-through of downstream purchasing activity. 

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