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

In November, the price of dimethyl carbonate showed a trend of first decline and then rise, and the price began to fall at the end of November.

I. Market Overview
1.1 DMC Market Trend

Price Trend of DMC in China in 2019-2020

In November, the overall trend of the domestic dimethyl carbonate market showed a trend of first decline and then rise. At the beginning of November, the market took on the weak market at the end of October. The price of propylene oxide, a raw material for transesterification, dropped sharply. The downstream wait-and-see mainly, the decline in the bidding price of the main downstream polycarbonate plant further led the market price downward. However, in mid-November, it turned out that cyclopropyl had stopped falling and rebounded, and some of the equipment on the supply side of the venue was affected by environmental inspections. It was temporarily stopped. The operating rate of the venue was low and the spot shortage. The market price rose sharply. The downstream high-end industries were moderately purchased. However, in the face of high prices, the demand side support is still limited. Although there were parking dynamics in mid-November for two weeks to support the market price firming, the subsequent recovery of the parking device and the market weakened again, and the price fell at the end of November.As of now, the price of DMC barrels is FOB1742USD / ton.

1.2 DMC Spot Price

Price Trend of DMC in 2020

1. In November, the price rose by $180 from October. Prices show a broad upward trend.

2. In November , the exchange rate between RMB and USD was 6.65 to 6.5.Exchange rate fluctuations have a greater impact on the price of dimethyl carbonate, with a price gap of about $20.

II. DMC plant installations

In November, a set of equipment with a total annual production capacity of 50,000 tons was shut down. Some factories reduced the load, and there were also temporary shutdowns due to equipment failure. The overall operating rate was about 60.91%. In December, a set of equipment with an annual capacity of 50,000 tons was scheduled to be shut down for maintenance. It is expected that the overall operating rate in December will be around 65%.

III. Raw Material

Price Trend of PO IN China in 2020.11

In November, the overall trend of the domestic propylene oxide market first declined and then rose, and fell again at the end of November. With the news that the plant with an annual production capacity of 300,000 tons at the end of October was bad for the market, coupled with the moderate delay in the parking and maintenance time of the large factory in East China with an annual production capacity of 240,000 tons, and the bearish sentiment in the theater, the downstream volume was reduced and the market began to change.  After the decline, factories talked more about shipments, and at one time low prices were frequently offered, which continuously and rapidly lowered the market's center of gravity, resulting in a plummeting situation, but the terminal and downstream raw material inventories were always low. After the price of propylene oxide fell to US$2136/ton, the downstream began to inhale on dips. After a short period of time in the terminal market, centralized replenishment, a large number of orders were received from the polyether factory, and the Huntsman factory was overhauled as planned on November 10. The short-term tightness of the market is positive. The propylene oxide factory stocks are quickly digested and transferred and then limited shipments, the price quickly rebounds. The increase is as rapid as the previous decline. In a short period of time, it returns to the high point of the year, but this time the increase is rapid. Downstream fears of heights gradually rose, fearing that the market would plummet again. After the new polyether orders continued to weaken, downstream purchases were reduced again. At the end of November, the atmosphere turned down, and the high point fell again during the year.

Demand Analysis

Traditional demand: The demand for coating solvents was mainly in East and South China. Because the price of dimethyl carbonate far exceeds that of related products, ethyl acetate, the traditional downstream basically replaces the formula and replaces it with other esters and benzene solvents. Although the current price of dimethyl carbonate has declined, the price is still high. The traditional downstream is mainly waiting and watching, and there are few purchases. It is expected that the traditional demand will rebound slightly after the price of dimethyl carbonate drops to a suitable price in December.

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, and the demand is relatively stable. The rest of the polycarbonate plants are mainly on the sidelines, and the plants 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 December, the supply side of dimethyl carbonate has a set of equipment storage and shutdown maintenance plan with an annual capacity of 50,000 tons. Other equipment is basically in normal production and operation, and the supply side is expected to be loose. On the demand side, the downstream does not accept high prices. In addition, the market for propylene oxide, a raw material, is temporarily waiting to see the decline. Under the expectation of weak demand at the end of the year, the overall DMC market is expected to be loose. On the demand side, the downstream does not accept high prices. In addition, the market for propylene oxide, a raw material, is temporarily waiting to see the decline. Under the expectation of weak demand at the end of the year, the overall DMC market is expected to continue to fall in December, with a weak shock.