September 16 news
I. Price Trends
According to the commodity market analysis system, as of September 16, the average price of top-grade DMF from Chinese enterprises was 6,000 CNY per ton. This week, DMF continued to show strength, entering an accelerated upward phase. The regional spot delivery prices are as follows: South China (Guangdong) 5,850-6,000 CNY per ton, Shandong and surrounding areas 5,600-5,700 CNY per ton. Major companies generally quoted above 6,000 CNY per ton, with Xinlianxin in Jiangxi and Ronghui Chemical in Guangdong both quoting 6,000 CNY per ton, and Henan Ruibai quoting 6,600 CNY per ton (with low plant load).
2. Cause Analysis
Cost Perspective: Methanol port inventory has hit a new low since 2013, standing at 3.818 million tons—a year-on-year decrease of 69.87%. Spot prices in Taicang range from 3,765 to 3,790 CNY per ton, providing strong support; however, high prices have already triggered negative feedback. Supply of synthetic ammonia and liquid ammonia in northern China has tightened beyond expectations: in Shandong, mainstream prices are between 2,690 and 2,930 CNY per ton, reaching a six-month high. The rising cost of dimethylamine is directly passing through to the methanol market. Port inventory has fallen to its lowest level since 2013, and imports continue to contract due to the shutdown of Iranian facilities and ongoing disruptions in the Strait of Hormuz, making it difficult to close the short-term supply gap. However, we should remain vigilant about the risk that high profits may spur resumption of production—national methanol operating rates currently stand at 82.89%. With expectations rising for multiple units to restart in mid-to-late September, signs of failed auctions on the mainland and a pullback in futures prices have already emerged this weekend, limiting upward price elasticity. On the synthetic ammonia side, coking enterprises have reduced output due to losses, and the resumption of production at malfunctioning units has been repeatedly delayed, making it challenging to ease the tight supply situation. As a result, the benchmark price for liquid ammonia has risen to 2,950 CNY per ton over the course of the week.
Supply Side: The biggest variable this week is that Hualu Hengsheng (600426) will halt one of its coal gasification units and related products for maintenance starting from September 8, lasting approximately 20 days. This is expected to impact revenue by 230 million yuan. The coal gasification unit is the "heart" of the production lines for downstream products like DMF, and this maintenance further reinforces the supply contraction logic. Additionally, a 150,000-ton/year unit in Jingzhou has been under maintenance for about three weeks since mid-to-late August, limiting output from leading companies. Factories have no inventory pressure and are strongly inclined to maintain prices. Operational status: Hualu Hengsheng's two lines in Dezhou are operating normally (bulk water at 6,100 CNY/ton), Luxi's 350,000 tons and Xinlianxin's 200,000 tons in Jiangxi are also running normally, while supplies from Shandong Jinkong Riyue are limited. Overall, industry operations have declined compared to earlier periods.
Market Demand Situation: PU Coating/Artificial Leather (accounting for over 60% of consumption): This week, the operating rate for standard coating materials stood at 61%, unchanged from the previous week. In East China, wet-process coatings are priced between 8,200 and 8,700 CNY per ton, while dry-process coatings range from 8,500 to 9,000 CNY per ton—price levels remain stable. Coating material manufacturers are primarily focused on absorbing the impact of the DMF price increase and adhering to their planned production schedules; new orders remain limited, with most companies fulfilling earlier contracts. At the downstream end, domestic demand for footwear, apparel, and luggage remains weak, while overseas demand is lower than in previous years. Leather factories are only replenishing stocks as needed, with no significant bulk stocking. Orders for the autumn and winter seasons are being fulfilled according to plan, with limited growth. As for electronic-grade DMF: prices remain independently strong, though the volume traded is relatively small. Demand for acrylic fibers and pharmaceutical solvents remains rigid but is unlikely to alter the overall market situation significantly. Regarding exports: orders from Southeast and South Asia remain stable, diverting only a small portion of China’s surplus capacity.
3. Future Market Prediction
DMF analysts believe: Base scenario (higher probability): DMF will remain strong and oscillate with a gentle upward shift for the rest of September, with prices in Jiangsu ranging from 5600 to 6300 CNY per ton. The support comes from: ① Hualu Hengsheng's maintenance will continue until the end of September, prolonging the tight supply of spot goods, ② low methanol inventory + geopolitical premium is difficult to dissolve in the short term, ③ the peak demand season of "Golden September and Silver October" is still gradually releasing.
