The Baltic Shipping Exchange’s dry bulk index fell Tuesday, offsetting strong demand for small vessels as cape-type freight hovered near a three-year low.

The overall dry bulk index fell 6 points, or 0.9%, to 663.

The Cape index fell 56 points, or 15.8%, to 299, its lowest level since the end of March 2016. Average daily profit decreased by $362 to $4,535. The normal carrying capacity of this type of ship is between 170,000 tons and 180,000 tons, carrying cargo such as iron ore and coal.

The Panamanian Ship Price Index rose 24 points, or 2.7%, to 924, the highest level in six weeks. Average daily profit climbed $187 to $7,436. The normal carrying capacity of this type of ship is between 60,000 and 70,000 tons, and the cargo is usually coal or grain.

The super-handy index rose 9 points, or 1.2%, to 776.

In March, the release of domestic agricultural demand is expected, and fertilizer manufacturers are also closely watching the slight changes in the market. So far, the “strong” rebound of nitrogen fertilizer urea market, such as Shandong, Hebei and other places, has led to a marked rise in prices, leading to the downstream measures are not as good as, but the wholesale prices of urea in Anhui, Ningxia, Yunnan and other basic layers are falling, the terminal for the next trend of urea there is greater concern. Is the desire of ammonium chloride, a small nitrogen fertilizer, to pull back the game with the momentum of urea slim? At present, the ammonium chloride market is in a dilemma of “three high and one low”: high start-up, high inventory, high terminal wait-and-see mood, low price of ammonium chloride.

At present, the domestic ammonium chloride market is weak, enterprises can generally guarantee the bottom of the pre-collection, buy-out prices are also intermittently lowered. The mainstream wet ammonium factory quotation in East China is about 500-520 yuan/ton, some 480-490 yuan/ton, and the mainstream dry ammonium factory price in Central China is about 680-710 yuan/ton, some can guarantee the bottom or single negotiation. The inventory of enterprises is increasing constantly, with a small amount of 10,000 tons and a large number of about 2.3 million tons. At present, the most difficult problem for enterprises is how to digest the inventory as soon as possible. Looking at March when the spring Market starts, whether the ammonium chloride factory can clear the inventory and whether the price can survive or not needs to consider the changes of various factors comprehensively.

Firstly, the difficulty of start-up of joint alkali enterprises has been significantly reduced. According to statistics, the overall industry start-up rate of domestic joint alkali enterprises is 77%. The ammonium chloride plant in North China is basically full-load production; in East China, except for individual plant overhaul, more than 80% of the other plants are started, but one of them has overhaul plan in March; in Central China, the ammonium chloride plant is basically full-load production; in addition, in the overhaul of a new plant, the ammonium chloride plant in Southwest China will operate normally in the later period without accident; Work normally, a gas head ammonium chloride enterprise plans to resume full load after March 15, all of which means that the start of ammonium chloride enterprises will maintain a high level and have a rebound trend. However, we need to consider whether the environmental inspection will reduce the start of ammonium chloride, and the planned maintenance of individual enterprises in some areas will temporarily ease the pressure of shipment, but the effect is very little.

Second, demand is moving slowly. First, compound fertilizer enterprises start low-level operation, even if the spring market is imminent, but the recovery progress is slow, coupled with a small number of small and medium-sized compound fertilizer enterprises or plans to resume production after March 15, the inventory pressure of large and medium-sized compound fertilizer enterprises has not decreased, downstream traders and terminal grassroots pre-reserve supply is more sufficient, the replenishment progress is slow, which directly affects the production progress of compound fertilizer enterprises, raw materials. Fertilizer procurement enthusiasm is not high, with the majority of picking. Secondly, the demand of extruded granular ammonium chloride enterprises is limited, and some extruded granular ammonium chloride enterprises in Northeast China have not resumed production. Some extruded granular ammonium chloride enterprises in Henan Province have quoted only 700-730 yuan/ton in the early period. Although there are new granular ammonium chloride plants in Ningxia, Inner Mongolia, after all, the demand for raw powder ammonium is small, and at the same time, compound fertilizer is distributed to a certain extent. Third, the low price of agricultural products at the grass-roots level, high sales pressure, farmers’enthusiasm for planting land is not good, local planting structure may face adjustment, fertilizer habits may also change, the use of raw materials or reduce risks.

Thirdly, urea market fluctuates frequently, which has a great influence on ammonium chloride. This wave of urea warming is due to the appropriate purchasing in local agricultural market and environmental inspection. Some enterprises shift their production focus to liquid ammonia or parking maintenance. The supply of urea decreases. However, with the resumption of construction, the production of a small number of gas enterprises has been completed and the market is weakening, so the support for ammonium chloride has been reduced.

Finally, in general, even if demand starts after mid-March, the stock of ammonium chloride enterprises should be digested for a period of time, while the compound fertilizer enterprises own more stocks, slow production progress, and ammonium chloride enterprises themselves to maintain a high start, then inventory emptying is difficult.

On March 4, methanol futures continued to rise 4% in the afternoon.

Superimposed production restriction for spring inspection, methanol supply or tightening

Due to the early shutdown of the Southwest Gas Head Unit, including Jiuyuan in Sichuan, Kabera in Chongqing and Lutianhua in Sichuan, which restarted in early February, the upstream start-up rate has risen to around 70%, reaching a historical high in recent years. After March, with the end of the northern heating season, some heavy-duty devices will be restarted one after another. The Datang Duolun device, which stopped in early February, is expected to restart in early March, the Boyuan device in Inner Mongolia is scheduled to restart in mid-March, and the Qinghai Guilu and Qinghai Zhonghao gas head devices are also scheduled to restart in March, and then the Southwest gas head capacity will be restarted one after another for some time in the future. Restart capacity is expected to exceed 4 million tons.

However, according to the situation over the years, after March, the spring inspection of methanol will begin soon. The peak of the inspection is from March to May. Due to the specific production arrangements, the maintenance of some enterprises will be delayed to 4-6 months. According to the current announced maintenance plan, some coal head devices in Northwest China will take the lead in overhaul, including Rongxin 900,000-ton plant in Inner Mongolia, Jiutai 1 million-ton plant and Shanxi Tongfa 600,000-ton plant. The overhaul capacity will exceed 6 million tons in March-May. In addition, due to the recent impact of Linfen in Shanxi on the production restriction of coking enterprises, including Shanxi Coking, Shanxi Hongyuan, Shanxi Guangda and Shanxi Wanxinda coke oven gas methanol plants will be shut down for about one month in the near future, with an estimated capacity of about 800,000 tons. Considering that the two sessions will be held in March, it is not excluded that the northern environmental protection and production restrictions may be increased, and the overall supply may be tightened.

Foreign Power Feb. 27, OPEC Secretary-General Balkin said Wednesday that he agreed to hold an additional meeting in April to assess market reaction.

He said April would be a good time to assess the market and OPEC would make decisions based on market conditions.

Balkin also said that the implementation of previous production cuts was impressive and believed that it would continue in 2019.

He also said he was concerned about the situation of OPEC’s two major founders and the impact of sanctions, which complicate efforts to achieve and maintain market rebalancing.

On February 25, Shell released its latest LNG Prospects Report. The report points out that due to strong demand for cleaner fuels in Asia, the use of liquefied natural gas (LNG) continued to grow in 2018, with global demand increasing by 27 million tons to 319 million tons over the previous year. By 2020, global LNG demand will reach about 384 million tons. With the sustained and rapid growth of LNG demand, it is expected that the supply of LNG will be tight in the mid-1920s.

The report predicts that global LNG supply will increase by 35 million tons in 2019, and Europe and Asia are expected to absorb these new supplies completely.

In terms of demand, growth in Asia, especially in China, has been highlighted. In 2018, China’s LNG imports surged by 16 million tons, an increase of 40% over the previous year. “In 2018, Asian demand for LNG surpassed expectations again, and this strong growth is expected to continue. Investment in new supply projects is picking up and more investment will soon be in place. Maarten Wetselaar, executive director of Shell’s natural gas integration and new energy business, said.

On the supply side, Australia’s LNG exports will begin at the end of 2018, catching up with Qatar, the long-term leader, and will increase by 10 million tons in 2019. The two countries are ready to meet the demand for natural gas in Asia’s fast-growing economies to replace coal-fired power generation and heating to improve air quality.

At the same time, the report reminds us that the demand gap between LNG purchasers and suppliers tends to widen. Among them, LNG purchasers are more inclined to sign short-term, small batch, high flexibility contracts, thereby enhancing their competitiveness in the downstream electricity and gas markets. Most suppliers still want to sign long-term LNG sales contracts to obtain financing. Shell pointed out in its report that the difference in demand between buyers and suppliers must be addressed so that project developers can start implementing new projects.

From the current situation of signing trade contracts, the average duration of contracts signed in 2018 is 13 years, more than doubling compared with the six years in 2017, and the total contract volume has also increased more than doubled, reaching 600 million tons in 2018. Although LNG purchasers and suppliers have different tendencies in the way of contract signing, LNG trade activity continues to increase.

Price Trend

According to the price monitoring of business associations, as of February 26, the average price of domestic methanol market was 2 390 yuan/ton, and the domestic methanol market was strong.

II. Market Analysis

Products: Domestic methanol market shows a regional trend, the mainland market performance is strong. Mainland China is still able to move on with the support of olefin extraction, continuing last week’s trend, with a partial increase of 20-70 yuan/ton. Domestic freight rates have fallen a lot, making the arrival cost of consumer land a little looser; northwest guidance price has gone up 50 yuan/ton to 2000 yuan/ton, the mainland may follow up to a certain extent, pay attention to the price dynamics of manufacturers and transmission to the mainland market. On the port side, affected by high reservoir pressure and futures, the overall performance is general and weak shocks are dominant. In the short term, we still need to continue to pay attention to the changes of port inventory. Domestic freight rates for methanol have declined. The range is 10-50 yuan/ton. The freight rates of Inner Mongolia North Line to North Shandong refer to 300-380 yuan/ton, South Line to North Shandong refer to 290-320 yuan/ton, Shanxi part to North Shandong 120-190 yuan/ton, Guanzhong to North Shandong refer to 150-200 yuan/ton and South Shandong 150-190 yuan/ton. Xinjiang refers to 750-780 yuan/ton from North Shandong and Shenhua from Inner Mongolia refers to 350 yuan/ton from North Shandong.

Industry Chain: Formaldehyde: Linyi Formaldehyde Factory has returned to the market one after another, combined with the recent increase in raw material methanol finishing, to provide a certain cost support for the formaldehyde market. The prices of Zibo and its surrounding areas are around 1200 yuan/ton, while Linyi is around 1180 yuan/ton. Acetic acid: The domestic glacial acetic acid market is stable. Because Shunda equipment is overhauled, the market is slightly supported. Enterprise offer is stable for the time being. However, some manufacturers have obvious inventory pressure. Overall, Corporate pressure is not balanced. Downstream buying intention is cautious and general. On-site operation intention is cautious. Dimethyl ether: After the downstream phased replenishment, the overall domestic dimethyl ether Market shipment has weakened slightly, and the overall market price trend will return to rationality in the short term, and it is expected that there will be no lack of short-term expectations.

3. Future Market Forecast

Business Cooperatives Viewpoint: On the positive side, Northwest Guiding Price: Shaanxi-Mongolia Methanol has slightly increased this week, the current North-South Guiding Price is set at 2000 yuan/ton, which is 50 yuan/ton higher than last week; Domestic installations: Mainland based on spring inspection and other factors, and under the influence of environmental protection policies, maintenance enterprises have increased, local supply or contraction in the later period; Olefins: olefins procurement, pre-sale are good, expenditure. Methanol price of propylene raw material. On the negative side, inventory: in the continuous replenishment of port imports, high inventory is difficult to digest in the short term and the storage pressure is large; upstream: at present, some domestic gas projects are restored, and local supply is relatively abundant; freight: recently, the local freight of methanol has fallen significantly, which makes the cost of arrival of consumer goods slightly loose. Methanol analysts at business associations predict that the short-term domestic methanol market will rise slightly.

According to import and export statistics released by the Ministry of Industry and Commerce of India, coal imports from January to December 2018 amounted to 227 million tons, an increase of 29.154 million tons, or 14.7% over the same period last year. Among them, coal imports in December were 19.462 million tons, basically unchanged from the previous year, a slight drop of 0.04%.

In India’s fiscal year, coal imports in the nine months before fiscal year 2018-19 (April-December 2018) amounted to 173 million tons, an increase of 191.34 million tons, or 12.5% over the same period last year.

On February 24, the hydrofluoric acid commodity index was 105.26, which was the same as yesterday. It was 25.04% lower than the peak of 140.43 points in the cycle (2018-02-21), and 96.42% higher than the low of 53.59 points on November 30, 2016. (Note: Period refers to 2011-09-01 to date)

According to statistics, the recent domestic market price trend of hydrofluoric acid continued to decline, as of 25 days, the domestic market price of hydrofluoric acid was 11475 yuan/ton, and the domestic start-up rate of hydrofluoric acid was more than 60%. Enterprises reflected that the current spot supply of hydrofluoric acid in the field was sufficient, the recent situation of goods in the field became worse, some enterprises’hydrofluoric acid inventory increased, and the ex-factory price continued to decrease, but due to the high level of raw material market. Supported by this, the price decline of hydrofluoric acid market is very limited. At present, the mainstream of hydrofluoric acid negotiations in the southern region is about 10500-11500 yuan/ton, while the price of hydrofluoric acid in the northern market is between 11000-12000 yuan/ton. Domestic hydrofluoric acid market prices are lower, spot supply is sufficient, due to the recent lower raw material market prices, fluorite prices fell, lost cost support for hydrofluoric acid, hydrofluoric acid market prices continue to fall.

Recent downstream refrigerant product installations started generally, the demand for upstream fluorite and hydrofluoric acid has weakened, the recent downstream refrigerant trading market has declined, and the price of hydrofluoric acid products has slightly declined. Recent downstream refrigerant market trading market is cool, R22 refrigerant facility starts at 70%, R22 refrigerant facility start-up rate is temporarily stable, the main production enterprise’s bulk water out-of-factory quotation dropped to 17,000-18,000 yuan/ton, but there is no bulk water spot in the production enterprise, mainly a small number of cylinders shipped. In addition, the actual demand side of the market has declined, and the shipment market trend is poor. The domestic market price of R134a is slightly lower, the start-up rate of production enterprises is lower, the market demand for refrigerants is weakened, and manufacturers mainly export their products. However, the on-site transaction price does not change much. Businessmen purchase on demand. Recently, due to the bad impact of purchases, the market demand for hydrofluoric acid upstream has weakened, and the market price of hydrofluoric acid has declined.

Refrigerant on-site transaction prices slightly lower, refrigerant industry equipment start-up rate is low, for the upstream market demand for hydrofluoric acid weakened, coupled with the upstream refrigerant industry to resist the high price sentiment of raw materials, Business Analyst Chen Ling believes that the hydrofluoric acid market will continue to decline, hydrofluoric acid prices will be around 11,000 yuan/ton.

Vadim Yakovlev, the first vice president of Gazprom, said in an internal magazine Thursday that the company expects oil production to grow by 2% in 2019, Reuters reported in Moscow.

Yakovlev said that this forecast means that global oil production will decrease in the first half of this year.

He added that even if OPEC and non-OPEC countries decided to extend the production reduction agreement in the second half of this year, the Russian Natural Gas Industry Corporation would still increase production this year.

According to Dow Jones, a report released Tuesday by the U.S. Energy Information Agency (EIA) predicts that crude oil production in the seven major shale oil producing areas of the United States will increase by 84,000 barrels per day in March to 8,398,000 barrels per day. Crude oil production across the Permian basin in Western Texas and southeastern New Mexico will increase by 43,000 barrels per day, making it the largest shale oil production area.