[POM Weekly Review] Equipment Maintenance Struggles to Reverse Weakness, Market Operates in Weak Fluctuations

I. Market Focus This Week

1. Yankuang Luhua Phase I and II POM units have been shut down simultaneously for maintenance, leading to a temporary reduction in industry supply.
2. Some domestic manufacturers are inclined to lower their ex-factory quotations, putting significant pressure on spot prices.
3. Overall market pessimism is spreading, and both traders and end-users are increasingly adopting a wait-and-see attitude, with trading activity remaining subdued.

II. Market Analysis for This Week

III. Analysis of Market Impact Factors

1. Price trendThis week, the domestic POM market continued to fluctuate on the weak side. Prices of mainstream grades in East China remained unchanged from last week, while prices in South China edged down slightly, leaving the overall market center of gravity stable but weak.
2. Operating loadThis week, the domestic POM industry's capacity utilization rate is 83.56%, which is basically unchanged from last week. Although the maintenance of the Yanzhou Coal and Chemical plant has caused a partial reduction in output, other enterprises are operating steadily, and there has been no significant fluctuation in overall industry output. The overall pressure on the supply side has not been substantially alleviated.
3. Profitability LevelThis week, the average gross profit of domestic POM is 1542 yuan/ton, a significant drop of 595 yuan/ton compared to last week. The weakening product prices combined with fluctuations in raw material costs have clearly narrowed the profit margins for enterprises, leading to increased pressure on production and operations.

IV. Market Forecast for Next Week

1. Supply sideYankuang Luhua’s plant is expected to restart operations, while Xinjiang Guoye’s plant is scheduled for maintenance. With one increase and one decrease, the overall industry supply is likely to see limited change, and the supply side is unlikely to provide effective support to the market.
2. Demand sideIn the early stage, ex-factory prices continued to decline, and market quotations remained in the lower range. Some end users and downstream buyers have gradually begun to consider bottom-fishing, with the possibility of making small-volume purchases at low prices. However, overall buying interest remains limited and is unlikely to drive a reversal in the market.
3. Cost aspectThe price of raw material methanol remains in a range-bound fluctuation, with a relatively stable trend. Affected by the continuous decline in POM product prices, the industry's profit margins are likely to continue to narrow, and there are no positive drivers on the cost side.
4. Macroeconomic AspectThe external impact brought by geopolitical conflicts is gradually weakening, and the market’s focus is returning to the industry’s own supply and demand fundamentals, with external news factors finding it difficult to influence price trends.

5. Key Focus

1. Supply side: Progress of Yankuang Luhua unit startup, status of Xinjiang Guoye maintenance implementation, tracking overall industry operating rates and changes in supply sources.
2. Demand side: End-users’ willingness to restock on dips, and the extent of increased market trading volume.
3. Cost side: methanol price fluctuations and changes in the POM industry’s profit margin.
4. Sentiment: Pricing adjustment trends among manufacturers and changes in traders’ sales strategies.