Market Analysis - Monthly Report - September, 2020 - Dimethyl Carbonate

The dimethyl carbonate market was severely out of stock in September, and prices soared.

I. Market Overview

1.1 DMC Market Trend

In September, the domestic dimethyl carbonate market soared all the way up, creating a record high. At thebeginning of September, affected by the continuous increase in the price of raw material propylene oxide, thetraditional transesterification method of dimethyl carbonate plants generally had greater cost pressure, andthe offer was passively increased to follow the price of raw materials. While the price of propylene oxidecontinues to rise, the supply of propylene oxide is difficult to find. Many plants in the market havetemporarily shut down for maintenance. The order delivery date of dimethyl carbonate from other plants innormal operation is scheduled to be October. Under the shortage of ester spot, prices have continued to risewidely and constantly set new historical highs. However, the downstream follow-up has gradually becomedifficult. The wait-and-see market is gradually left with only a few just-needed purchases, market supply anddemand are weak, and transactions are deserted. The price of dimethyl carbonate consolidated at a highlevel at the end of September.As of now, the price of DMC barrels is FOB1982 USD / ton.

1.2 DMC Spot Price

1. The price in September increased by US$747 compared to August.The price of dimethyl carbonate soared. 2. In September , the exchange rate between RMB and USD was 6.8 to 6.75.Exchange rate fluctuations havelittle effect on the price of dimethyl carbonate.

II. DMC plant installations

In September, two sets of devices with a total annual capacity of 100,000 tons were shut down formaintenance, and individual factories reduced the load, and the overall operating rate was about 64.22%. InOctober, there are 3 sets of devices with a total annual production capacity of 150,000 tons planned for 10days. Two sets of new devices are expected to be put on the market. The overall operating rate in October isexpected to be around 75%.

III. Raw Material

In September, the price of propylene oxide went up all the way, with outstanding performance and betterprofitability. Supply and demand have been positive throughout the month, profit margins remain high, smalladjustments in cost have little impact on market conditions, and most of the on-site installations havemaintained high load operation, and imported goods have been relatively stable but have not been able toalleviate the tight supply. , The downstream market waits and sees that the cyclopropyl continues to rise, which is easy to rise and hard to fall. It is actively purchasing and the market is in short supply. The price roseto around mid-September, the market price was chaotic, and traders could still trade at high prices. Downstream products were once uncontrolled and soared for a short time. However, as the price of propylene oxide set daily highs, the market panic at the end of the month gradually Obviously, the terminal'sfollow-up momentum is insufficient, and it has turned to just need to purchase. The new downstreampolyether orders turn weak and are unable to follow up. The overall downstream willingness to stock upbefore the holiday is low. Although the propylene oxide factory is still under pressure to ship, it is stillwatching the downstream situation. The rally slowed down and stabilized.

Demand Analysis

Traditional demand: The demand for coating solvents was mainly in East and South China. Because the priceof dimethyl carbonate far exceeds that of related products, ethyl acetate, the traditional downstreambasically replaces the formula and replaces it with other esters and benzene solvents. At present, the price ofdimethyl carbonate is high, and the traditional downstream is mainly waiting and watching. Polycarbonate: The polycarbonate plant with dimethyl carbonate supporting equipment has a stable outputof about 300-600 tons per month. The main polycarbonate plant is bidding a small amount every week, andthe demand is relatively stable. The rest of the polycarbonate plants are mainly on the sidelines, and theplants are running at low load, waiting for the price of dimethyl carbonate to fall.

Electrolyte: The rigid demand is mainly in northeastern China.

IV. Summary

In October, there are 3 sets of equipment with a total annual capacity of 150,000 tons on the supply side ofdimethyl carbonate, which are scheduled to be overhauled for 10 days. Most of the rest have no maintenanceplans for the time being, and both new devices are planned to be put on the market. The supply side isexpected to increase, while the demand side On the one hand, in the face of high prices of dimethyl carbonate, downstream demand is flat, and the downstream bearish sentiment in October, it is expected that mostdownstream factories will purchase dimethyl carbonate after the price declines, and the start ofpolycarbonate will be low. The overall forecast is for carbon dioxide in October. The market price of methylesters stabilized temporarily, and then the expectation of falling back was maintained.