Chinese Methyl Methacrylate Prices Drop Due to Quiet Downstream Demand
- 17-Jun-2022 3:36 PM
- Journalist: Nina Jiang
As per recent insights, Methyl Methacrylate prices have plummeted in the Chinese market after stagnating. Not only the spot prices but also the contract prices have been lower in the country, which has weakened the upward trend of Methyl Methacrylate in the domestic market.
On the other hand, volatility in upstream crude oil prices had a significant impact on raw material costs, particularly Methanol, causing prices of Methyl Methacrylate (MMA) to follow a downward trend in the regional market.
Additionally, the operating efficiency was minimal for the manufacturing of Methyl Methacrylate this time, which has also contributed to its price dip. Meanwhile, the Methyl Methacrylate contracts were weaker than before, which has further dwindled the market value of Methyl Methacrylate in the regional market. In addition, the downstream demand from end-users for the fabrication of Poly Methyl Methacrylate and from the other segments, notably automotive and construction, has also been bearish, ultimately decreasing the Methyl Methacrylate cost in the domestic market.
Also, the depreciation of the Chinese currency (Yuan) against the US dollar has dampened China's Methyl Methacrylate prices. As a result, the prices of Methyl Methacrylate settled in the range of USD 1866/MT to USD 2015/MT.
Besides, the other factor contributing to the price decline was the easing of lockdown restrictions in the country. As lockdown restrictions have been cut off, the port congestion has eased, coupled with a decline in freight charges.
Another reason for the price fall could be market competitiveness, as after reopening the market, the manufacturers have been lowering their profit margins to clear out their existing stockpiles. However, buyer enthusiasm decreased, and most buyers retreated to the side-lines for a wait-and-see mindset and only bought on a need-to basis.
According to ChemAnalyst estimation, "prices of Methyl Methacrylate are expected to increase in the upcoming weeks as raw material prices for Methanol are anticipated to surge." In addition, China will likely reimpose a lockdown restriction, which further disrupts industrial and trade activities. At the same time, demand for Methyl Methacrylate in the production of Polymethyl Methacrylate is anticipated to improve in the Chinese market".