trans-dichloroethylene

Market Intelligence on trans-Dichloroethylene

I. Price Trends
1. Domestic Market:
- East China: The mainstream transaction price is 12,500–13,000 CNY/ton, up 2.3% from the previous week, primarily driven by rising raw material costs and tight supply.
- South China: Prices range from 12,800–13,200 CNY/ton, with a 1.8% increase, supported by phased release of downstream demand.
- North China: Prices remain stable at 12,300–12,700 CNY/ton, reflecting regional price gradients due to differences in logistics costs.

2. International Market:
- Asia: CFR China prices have risen to USD 1,650–1,700/ton, influenced by domestic price transmission and exchange rate fluctuations.
- Europe & US: FOB US prices are maintained at USD 1,900–1,950/ton. In Europe, prices have increased to EUR 1,850–1,900/ton due to high energy costs.

II. Supply and Demand Dynamics
1. Supply Side:
- Domestic capacity utilization is approximately 75%, up 3 percentage points from the previous month. However, actual production growth is limited due to environmental restrictions on some enterprises.
- Imports decreased by 12% month-on-month, mainly because international suppliers prioritized orders from the US and Europe, causing delays in arrivals in Asia.

2. Demand Side:
- The operating rate of the downstream PVDF (Polyvinylidene Fluoride) industry has increased to 85%, driving a 10% growth in demand for trans-dichloroethylene.
- Demand in the pesticide intermediate sector remains stable, but the procurement pace has slowed due to seasonal factors.
- Export orders increased by 8% month-on-month, primarily flowing to Southeast Asia and India.

III. Costs and Profits
1. Raw Material Costs:
- Vinyl Chloride Monomer (VCM) prices have risen to 6,800–7,200 CNY/ton, up 15% year-on-year, pushing up production costs for trans-dichloroethylene.
- Seasonal increases in electricity and natural gas prices have further compressed corporate profit margins.

2. Profit Levels:
- The industry average gross margin has decreased to 12%–15%, down 3 percentage points from the previous month. Some small and medium-sized enterprises are facing pressure of losses.

IV. Inventory and Logistics
1. Inventory Levels:
- Domestic social inventory has dropped to 12,000 tons, a 15% decrease from the previous month, reaching a three-year low.
- Port inventory has slightly accumulated due to import delays, but overall pressure remains manageable.

2. Logistics Impact:
- Domestic road transportation costs have increased by 5%–8%. In some regions, transport capacity is tight due to epidemic control measures.
- Sea freight prices are fluctuating at high levels, with shipping rates on Asia-to-Europe/US routes up 30% year-on-year.

V. Policy and Environmental Factors
1. Environmental Policies:
- Jiangsu, Shandong, and other regions have strengthened controls on VOCs emissions from chemical enterprises, leading to production limits of 10%–20% for some companies.
- Expectations for the expansion of the carbon trading market are rising, which may increase corporate production costs in the long term.

2. Trade Policies:
- India has initiated an anti-dumping investigation on trans-dichloroethylene. While this may affect short-term exports, the long-term impact is expected to be limited.

VI. Analysis and Forecasts
1. Short Term (1–2 weeks):
- Prices are expected to remain high with oscillations. In East China, prices may test the 13,200–13,500 CNY/ton range, supported by raw material costs and tight supply.
- Phased inventory replenishment on the demand side may push prices up slightly, but the upside is limited by compressed downstream profits.

2. Medium Term (1–3 months):
- Prices may fall back to 12,000–12,500 CNY/ton as domestic capacity is released and import arrivals increase, alleviating the supply tightness.
- Attention should be paid to the price trend of raw material VCM and changes in the operating rate of the downstream PVDF industry.

3. Long Term (3–6 months):
- The price center may shift upward to 12,500–13,000 CNY/ton, supported by increased environmental compliance costs and high energy prices.
- Export markets may expand due to the restructuring of international supply chains, but trade friction risks must be monitored.

VII. Risk Warnings
1. Risk of significant fluctuations in raw material VCM prices.
2. Risk of unexpected tightening of domestic environmental policies.
3. Risk of increased export costs due to sustained rises in international sea freight prices.