China MTBE Market Sees Significant Downturn

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According to SunSirs' commodity market analysis system, MTBE prices fell from 5,820 RMB/ton to 5,427 RMB/ton between June 15 and June 22. This represents a 6.74% drop over the period, a 15.53% decline month-on-month, and a 4.88% increase year-on-year. The domestic MTBE market experienced a fluctuating decline. During the week, news that the US and Iran would soon formally sign a peace agreement and that the Strait of Hormuz would gradually reopen caused international crude oil closing prices to plummet; the gasoline market followed suit. The downward trend for MTBE intensified due to sluggish export negotiations and mounting domestic sales pressure. Although manufacturers offered price concessions to move stock, they struggled to effectively stimulate buyer interest, and trading volume remained weak.

Regarding costs and crude oil: International oil prices fell sharply. Key bearish factors included the remote signing of a memorandum of understanding between the US and Iran—moving toward second-stage negotiations—and confirmed reports that the US had eased maritime controls on Iran and relaxed oil export sanctions, causing market concerns over crude oil supply to subside. As of June 19, the settlement price to the Brent crude oil futures contract to September delivery stood at $80.05 per barrel.

On the demand side: Downstream activity was weak as the frequency of general travel decreased. Expectations of further declines in international oil prices and a projected sharp drop in the next round of retail price caps to refined oil items weighed on the gasoline market. Demand-side factors to MTBE were predominantly bearish.

On the supply side: Production increased as units at Maoming Shihua and Dechen Energy commenced operations, raising the overall plant operating rate. Supply-side factors were also bearish to MTBE.

As of the close on June 19, the Asian MTBE market closing price rose by $21.33/ton from the previous trading day, with FOB Singapore prices settling at $761.55–$763.55/ton. The European MTBE market closing price increased by $37.50/ton, with FOB ARA prices settling at $973.99–$974.49/ton. The US MTBE market was closed due to the Juneteenth holiday.

Market Outlook: while raw material prices have retreated, they remain at high levels, and cost pressures persist. Manufacturers are still facing inventory pressure and will focus primarily on actively moving stock; analysts at SunSirs anticipate that the MTBE market will remain in a consolidation phase.

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