April MTBE Market Trends Fluctuate and Decline in China

April 30th News

According to the commodity market analysis system, the price of MTBE in April fell from 7,210 CNY/ton to 6,387 CNY/ton, a decrease of 11.42% during the period, and an increase of 24.69% year-on-year. At the beginning of the month, the market sentiment weakened significantly due to a sharp decline in international crude oil prices. The downward trend continued in the middle of the month, with unstable geopolitical situations and continuous volatile declines in international crude oil prices, which significantly suppressed the Chinese gasoline market. This led to difficulties in MTBE manufacturers' shipments, accelerating the bottoming out of MTBE prices. By the end of the month, as prices gradually reached the psychological level of traders, inquiries and trading activities improved, and market activity began to recover.

MTBE China Production Price Average Trend Chart:

Cost Perspective: Regarding crude oil, international crude oil prices showed an upward trend in April, with the average price increasing compared to March. In the first half of the month, the U.S. and Iran planned to hold their first formal peace talks, easing market concerns about supply risks and causing international oil prices to fall under downward pressure. In the middle of the month, Iran indicated that it would allow commercial vessels to pass through the Strait of Hormuz during the ceasefire period, alleviating geopolitical worries and leading to a drop in international oil prices. However, in the latter half of the month, U.S.-Iran peace talks hit an impasse, and the passage through the Strait of Hormuz remained restricted, rekindling concerns about disruptions to crude oil supplies and driving oil prices to rebound and rise again. As of April 29, the settlement price for the June Brent crude oil futures contract was reported at $118.03 per barrel.

Demand Side: On the downstream gasoline terminal demand front, international crude oil prices are likely to remain volatile, and market participants continue to adopt a cautious approach. Moreover, given the currently relatively high prices of gasoline feedstocks such as MTBE and alkylate, market players remain reluctant and tend to maintain a rigid stance on MTBE purchases. Thus, the impact on MTBE demand is mixed, with both positive and negative factors at play.

Supply side: During the month, some large manufacturers in China experienced temporary shutdowns, and some plants reduced their operating loads, leading to a decrease in resource supply. In May, some of the previously shut-down manufacturers may have plans to resume operations, while others have scheduled maintenance, and some may reduce their loads. Overall, this could result in a slight reduction in resource supply. The supply side for MTBE is influenced by positive factors.

As of April 30, statistics on MTBE factory prices from selected manufacturers:

As of the close on April 29, the Asian MTBE market closed at a price that was up $22.1 per ton from the previous trading day, with FOB Singapore prices ranging from $1,053.98 to $1,055.98 per ton. In the European MTBE market, closing prices rose by $50.75 per ton from the previous trading day, with FOB ARA prices ranging from $1,188.74 to $1,189.24 per ton. In the U.S. MTBE market, closing prices increased by $50.65 per ton from the previous trading day, with FOB Gulf offshore prices ranging from $1,254.34 to $1,254.69 per ton (354.17 to 354.27 cents per gallon).

Market Forecast: On the supply side, fluctuations are likely to remain relatively narrow. Terminal demand remains relatively stable, and with raw material costs remaining high, manufacturers are unlikely to offer substantial price concessions. However, given the oversupply situation, the market is likely to continue operating on the weaker side. MTBE analysts believe that the MTBE market trend is expected to keep declining.