[Industry Focus]：MMA market high in the first half of the year, supply and demand tight balance under the price or continued to strengthen.

entering the first half of 2024, the MMA (methyl methacrylate) market showed an unprecedented high upward trend. This trend was mainly due to the surge in export orders, which greatly promoted the growth of total demand. significant improvement in the balance between supply and demand, MMA Price the record high in six years provides strong support. Although the forecast at the beginning of the year was biased in actual operation, the actual performance of the market far exceeded expectations, especially in the tight balance of supply and demand, prices maintained a high operating trend.

1. Supply-side analysis

plant operation and capacity change: in the first half of the year, the stability of MMA devices at home and abroad was not good, especially the restart of domestic devices was not smooth, resulting in the expected supply increment not being realized as scheduled. This situation directly reduces the supply on the market and creates conditions for price increases. In addition, despite the new production capacity (e. g. Yixiang 150000 tons plant), but the overall growth rate is still slow, failed to effectively ease the market tension.

Impact of raw material prices: as the main raw material of MMA, the price of acetone increased significantly year-on-year, and the month-on-month increase was also ahead of other raw materials. The rise in the acetone market was mainly influenced by the shift from cost pressures to supply support, and the shutdown and overhaul of some phenolic ketone units reduced the in stock circulation of acetone, further pushing up its price. At the same time, although the price of acrylonitrile is also affected by changes in supply and demand, the overall increase is small, and most of the time is below the historical five-year average price.

2. Demand-side analysis

domestic demand growth: with the release of new capacity in downstream industries such as PMMA, domestic MMA consumption continues to grow. Domestic consumption reached 600000 tons in the first half of the year, a significant increase over the same period last year. However, due to the high base in some months, there was a slight decline from the previous month.

Export drive: exports became a highlight of the MMA market in the first half of the year, with total exports increasing by 67.15 per cent over the same period last year. The centralized delivery of overseas orders not only reduces the supply of domestic trade, but also directly drives the growth of overall demand and forms a strong support for prices.

price highs and lows: the high of MMA market price in the first half of the year occurred at the end of April, reaching 16550 yuan/ton, which not only set a new high in the first half of the year, but also set a new high since 2019. The main drivers of price increases came from just-in-time replenishment before the May Day holiday and concentrated delivery of overseas orders. The low point occurred during the Spring Festival holiday in February. Affected by weak demand, the price fell narrowly to 12350 yuan/ton.

Average price and increase: in the first half of the year, the average price of domestic MMA in East China was 14281 yuan/ton, up 32.04 percent from the same period last year and 23.58 percent from the previous year. As of June 26, the closing price reached 15400 yuan/ton, up 19.38 percent from the beginning of the year.

MMA industry: as the core link of the industrial chain, the profit of MMA industry achieved substantial growth in the first half of the year, rising 153.85 percent month on month and 191.98 percent year on year. This is mainly due to its cost increase is lower than the price increase, so that the profit margin can be expanded.

Upstream and downstream industries: the upstream acetone industry is at a loss due to cost pressures and tight market supply, while the acrylonitrile industry is affected by the decline in raw material prices, the theoretical profit from negative to positive. Profits in the downstream PMMA industry also increased to a certain extent, but the increase was relatively small.

Looking forward to the second half of the year, the operation of the MMA market will be affected by many factors. On the supply side, it is necessary to pay attention to the production progress of the new capacity and the stability of the operation of the plant; on the export side, changes in overseas markets will directly affect the quantity and price of export orders; on the cost of the industrial chain, fluctuations in raw material prices will continue to have an impact on MMA prices. On the whole, under the tight balance of supply and demand, MMA prices are expected to maintain high levels, but the specific trend needs to be dynamically adjusted according to the actual market conditions.