[Introduction]: Before the May Day holiday of 2026, China's dichloromethane market experienced volatile and weak performance, with a clear conflict between weak supply-demand dynamics and high costs. Market transactions were cautious, and the price center moved narrowly downward. After the holiday, the market will enter a phase of short-term adjustment and marginal improvement. The three-way tug-of-war among supply, demand, and costs will persist, resulting in a pattern of "weak volatility, slight recovery, and limited rebound," with no significant reversal expected.

1. Market Review (April 27 - April 30)

Table 1: Domestic Dichloromethane and Related Product Price Sheet

| | 2025/4/23 | 2025/4/30 | Change | Change % | Unit |
|---|---|---|---|---|---|
| Key Regions | | | | | |
| National | 2411 | 2297 | -114 | -4.73% | Yuan/MT |
| Shandong | 2099 | 2018 | -81 | -3.86% | Yuan/MT |
| East China | 2374 | 2262 | -112 | -4.72% | Yuan/MT |
| South China (Delivered) | 2760 | 2610 | -150 | -5.43% | Yuan/MT |
| Key Downstream | | | | | |
| Product Name | | | | | |
| Refrigerant R32 | 63500 | 63500 | 0 | 0.00% | Yuan/MT |
| Key Related Products | | | | | |
| Product Name | | | | | |
| Dichloroethane | 3239 | 3040 | -199 | -6.14% | Yuan/MT |
| Data Source: chempricehub | | | | | |

Before the May Day holiday, the domestic dichloromethane supply side remained loose, with industry operating rates hovering around 80%. Production enterprises generally operated stably, while new capacity from Henan Jinhai was released steadily, resulting in ample market supply. As the holiday approached, downstream end-users mainly purchased small quantities on an as-needed basis. With dichloromethane prices still relatively high and affected by policy factors, there was no significant large-scale stockpiling before the holiday. Overall purchasing sentiment was cautious, market participants adopted a wait-and-see approach, transaction activity was moderate, and most players operated by following market trends.

During the May Day holiday, some small downstream companies reduced production, coupled with limited logistics transport capacity, leading to further accumulation of social inventories. Although some chloride enterprises stated that holiday inventories were manageable, the overall focus during the holiday was on destocking, and the primary task for enterprises after resuming work was also inventory reduction. The post-holiday loose supply pattern is unlikely to be fundamentally reversed, and inventory pressure will continue to limit the space for price rebounds.

2. Data Analysis

Table 2: Domestic Dichloromethane and Related Product Data Sheet

| | | 2025/4/23 | 2025/4/30 | Change | Change % | Unit |
|---|---|---|---|---|---|---|
| Product Name | | | | | | |
| Dichloromethane | Production Profit | -67 | -197 | -130 | -194.03% | Yuan/MT |
| | Capacity Utilization | 80.81% | 79.75% | -1.06 ppt | -1.31% | Percentage Point |
| Product Name | Key Downstream | | | | | |
| Refrigerant R32 | Capacity Utilization | 66% | 66% | 0 ppt | 0.00% | Percentage Point |
| Data Source: chempricehub | | | | | | |

Before the holiday, the supply of methane chlorides decreased compared to the previous period. During the period, Jiangsu Fuqiang's 300,000 MT/year unit experienced a short-term shutdown, and some units that had previously reduced loads had not yet resumed stable operations, leading to a decline in overall output and capacity utilization.

Regarding costs, the cost side for dichloromethane remained high. The price of liquid chlorine rose sharply, and methanol prices stayed elevated, putting significant cost pressure on methane chloride producers, resulting in substantial losses. According to calculations based on chempricehub data, the average weekly profit for methane chlorides in this period was -197 Yuan/MT, a decrease of 130 Yuan/MT from the previous period, a drop of 194.03%.

In the Shandong region, liquid chlorine prices remained stable at high levels; methanol prices were affected by the situation in the Middle East, with tight import arrivals, and after a moderate decline, prices stabilized and rebounded, staying at high levels. The contrast between high raw material prices and falling dichloromethane prices widened the cost-inversion gap, severely squeezing profit margins. Some enterprises found themselves in a dilemma: "cannot sell at higher prices, lose money at lower prices."

Before the holiday, the capacity utilization rate of downstream refrigerant R32 remained stable, around 60% weekly, providing rigid demand support for dichloromethane. Constrained by production quotas for third-generation refrigerants, R32 enterprises primarily focused on maintaining stable loads and controlling output, with no plans for substantial production increases, mostly maintaining current operating rates for scheduled production. Approaching the May Day holiday, downstream air conditioning end-users entered their holiday stockpiling rhythm ahead of time, and refrigerant factories also rationally controlled raw material inventories to avoid risks of logistics stagnation and inventory buildup during the holiday. Overall, purchasing sentiment was cautious and rational.

3. Post-Holiday Trend Outlook

Table 3: Domestic Dichloromethane Data Forecast Sheet

| | 2026/4/30 | 2026/5/6E | Change | Change % | Unit |
|---|---|---|---|---|---|
| Capacity Utilization | 79.75% | 82.06% | 2.31 ppt | 2.90% | Percentage Point |
| Key Downstream Capacity Utilization | 66% | 63% | -3.00 ppt | -4.55% | Percentage Point |
| Data Source: chempricehub | | | | | |

After the May Day holiday, Yonghao and Tai units plan to restart production, while no other units have clear shutdown plans. Therefore, the post-holiday capacity utilization rate for the methane chloride industry is expected to increase to 82.06%, up 2.31 percentage points from pre-holiday levels.

The cost side is expected to show a divergent trend of "firm liquid chlorine, weaker methanol." On the liquid chlorine supply side, there is no significant increase, and producers' willingness to support prices remains, with prices likely to maintain high volatility, providing strong support for dichloromethane. For methanol, port inventories are gradually accumulating, import arrivals are increasing, and prices may slightly decrease, weakening cost support. Overall, raw material price fluctuations will continue to dominate market sentiment. High costs limit the downside space, but poor cost transmission and weak demand make it difficult for prices to rise. The tug-of-war between costs and supply-demand fundamentals will continue to constrain the market trend.

As of April 30, 2025, sentiment survey results for the post-holiday month show: 25% bullish, 33% sideways, 42% bearish. Bullish sentiment is based on cost support and post-holiday downstream restocking; bearish sentiment stems from insufficient fundamental support; sideways sentiment expects narrow market fluctuations with limited changes.

Considering the three factors of supply, demand, and costs, the domestic dichloromethane market after the 2026 May Day holiday will continue weak and volatile in the short term, with a gradual slight recovery in the medium to long term. The price center may move slightly higher, but the rebound will be limited. In the short term, slow destocking and weak demand recovery may keep the market sluggish. In mid-to-late May, as inventory pressure eases, peak season demand gradually releases, and some units undergo maintenance or load reduction, prices may see a phased mild rebound but will remain in a low-level volatile range.

Key variables to monitor include: (1) the pace of enterprise destocking, which directly affects the space for price recovery; (2) raw material price fluctuations, particularly liquid chlorine and methanol trends, which determine cost support levels; (3) the sustainability of downstream restocking, especially in refrigerants and agrochemicals, which directly affects market trading activity. Overall, the post-holiday market is unlikely to escape the loose and weak pattern. Industry players should operate cautiously, follow market trends, and be alert to risks of price declines due to inventory pressure and weaker-than-expected demand.