Preamble
During this cycle, the domestic dichloromethane market exhibited a distinct "first weak, then strong" trend, with divergent fluctuations during the holiday period followed by a steady rebound after the holiday. The core driving factors revolved around inventory, supply, costs, and downstream sentiment, with the phased adjustment of the industry's supply-demand balance dominating price movements. As of May 8, the mainstream price in the Shandong region closed at 2,260 yuan/ton, up 150 yuan/ton from pre-holiday levels, representing an increase of 7.46%.

I. Improved Trading Activity and Post-Holiday Recovery from Lows
During this cycle, the domestic dichloromethane market showed a pattern of divergent consolidation during the holiday period and a recovery from lows after the holiday. The domestic market overall maintained a steady, narrow-range fluctuation during the holiday, with regional performance exhibiting differentiation. Some producers saw significant inventory accumulation during the holiday, leading to increased sales pressure. To accelerate destocking, companies proactively lowered quotes, causing the Shandong market to decline modestly first. However, it is worth noting that although upstream raw material liquid chlorine prices fell somewhat, they remained at medium-to-high levels, making it difficult for chloromethane producers to reduce production costs, and thus there was little willingness for deep market declines. Toward the end of the holiday, supported by cost pressure and reduced operating rates at some facilities in the Shandong region, companies raised their offer prices, and the market center rebounded from its lows.

II. Phased Regional Supply Contraction Boosts Price Rebound
A phased contraction on the supply side became the key driver of the market reversal in this cycle. During the holiday, most dichloromethane production units in Shandong were shut down or operated at reduced rates, tightening spot availability. Combined with rigid cost support, producers' sentiment to support higher prices strengthened continuously, prompting them to raise offer prices and pushing the market to stop falling and start rising. After the holiday, downstream buyers and traders, influenced by the mentality of "buying up but not down," began batch replenishment, further reducing producer inventory. This quickly eased inventory pressure on companies, prompting them to continue price-raising operations, ultimately achieving the market's reversal from weak to strong during this cycle.

During the cycle, Dongyue's unit output was reduced to 70%, bringing the average weekly capacity utilization rate in the key Shandong region down by 3.4 percentage points from the previous cycle to 66.02%. In East China, however, Jiangsu Fuqiang's 300,000-ton/year unit and Huichang Yonghe's 100,000-ton/year unit resumed stable operations, leading to an increase in output and capacity utilization rates in the East China region compared to the previous cycle.

III. Cost Pressure Persists for Chloromethane Companies; Cost-Side Driving Force Strengthens
The cost side became a core driver of this rebound. The mainstream price of liquid chlorine in Shandong is 400–500 yuan/ton, while methanol prices remain firmly supported. According to calculations by chempricehub, the theoretical cost of chloromethane in Shandong is around 2,450 yuan/ton. With oversupply and persistent losses in the chloromethane industry, the cost side has become an important factor influencing the sector.

IV. Buying Up but Not Down: Phased Downstream Replenishment
Pre-holiday market participants had limited stockpiling. After prices rose during the holiday, downstream buyers and traders, driven by the sentiment of "buying up but not down," showed increased procurement enthusiasm and stepped up replenishment efforts. The operating rate of fluorocarbon refrigerant R32 plants declined from the previous period, mainly due to a drop in production schedules for the household air-conditioning market, with suppliers focusing on volume control to support prices. In May, end-user production schedules are expected to decline, leading to a decrease in R32 demand. Export transaction volumes still lag behind domestic ones, and channel stocking intentions remain weak.

On the demand side, a phased adjustment pattern emerged. Following the price increase this cycle and post-holiday replenishment, downstream buyers and traders have already released some procurement demand. It is expected that procurement efforts in the next cycle will be lower than in this cycle, which may put some constraints on further price increases.

V. "Easy to Rise, Hard to Fall" Becomes the Main Theme
Overall, in the next cycle, the domestic dichloromethane market's supply-demand fundamentals are expected to remain acceptable for now. Low short-term inventory pressure among producers and strong cost support are the core drivers pushing prices higher. However, caution is needed regarding the risk of negotiation from declining downstream purchasing efforts. Future market trends should focus on downstream follow-up progress, plant operating conditions, and raw material price fluctuations. It is expected that the short-term market will show a volatile upward trend as the main theme, but the room for adjustment may be limited. In an era of persistent industry losses, "easy to rise, hard to fall" becomes the main theme, with companies primarily considering costs.