Dichloromethane Market Skyrocketed on Bullish Factors

The September is a different month for the dichloromethane market. In H1 September, the average price in North China increased by RMB 1,000/mt. And the average price in South China increased by RMB 1,100/mt. As the ex-works prices for dichloromethane were just around RMB 2,000-3,000/mt before, the boom this time was special in the market. Detailed analysis is as follows：

Decreasing inventory: At the end of August, the dichloromethane prices reached above RMB 2,000/mt, which hit traders’ expectation. Meanwhile, the unit in Dongying may undergo maintenance. The panic sentiments became strong in the market. Traders in South China and Shandong made bulk buy. Dichloromethane producers’ inventory declined.

Decreasing supply: At the beginning of September, the dichloromethane market jumped, and the inventory went down. Moreover, the supply in South China also went down. The unit at Jiangsu Meilan stared maintenance on September 10, and it was expected to restart on September 25. The unit at Zhejiang Juhua started maintenance on September 13. The unit at Shandong Dongyue started maintenance on September 15 and it was expected to last for half a month. The overall supply became tight. Given the increasing prices, some producers stopped selling and increased their inventories.

Rapid sales: With the dichloromethane prices increasing, downstream users and traders’ buying interest got stronger. The overall trading was active and the profits were positive.

On the whole, the dichloromethane prices increased stably. As the prices of raw materials are largely stable, the profits of dichloromethane are satisfactory. Some producers have stopped accepting orders and the overall supply will be tight. The price will continue to go up. However, downstream users may show resistance to the high prices. ECHEMI forecasts that the Chinese dichloromethane market may inch up.