Recently, the geopolitical conflicts in the Middle East have been escalating, causing disruptions to shipping in the Red Sea and the Strait of Hormuz, and causing a sudden tension in the global energy and chemical markets. For the dichloromethane industry, this geopolitical conflict has created a rare “two-way squeeze”: on the one hand, the price of key raw material methanol has skyrocketed due to supply concerns from Iran, while liquid chlorine has simultaneously strengthened, driving up costs strongly; On the other hand, the Middle East market (14 countries, involving a total amount of 132 million yuan), which accounts for 22.3% of the total export value, faces the risk of shipping delays, rejections, or even stagnation. The reverse movement of cost push up and export obstruction has plunged the market into a complex game of “price increase without demand, price reduction with cost”.
According to the Commodity Market Analysis System of Shengyi Society, as of March 5th, the mixed price of dichloromethane in Shandong region was 2095 yuan/ton, a significant increase of 19.37% compared to early March.
1、 Cost resonance: The sharp rise in raw materials solidifies the bottom of prices
The production cost of dichloromethane is driven by both liquid chlorine and methanol. The current situation in the Middle East has caused a surge in raw material prices through energy transmission, forming strong cost support:
In terms of methanol, Iran is the world’s second largest producer of methanol, with an average annual production capacity of about 17 million tons, accounting for 59% of China’s methanol imports. Affected by the geopolitical conflict in the Middle East, Iran’s cargo shipping has been hindered, import supply expectations have tightened, coupled with rising energy prices driving up costs, methanol prices have surged significantly, further pushing up the production cost of dichloromethane. On March 5th, the benchmark price of methanol in Shengyi Society was 2500 yuan/ton, an increase of 13.64% compared to early March.
In terms of liquid chlorine, downstream facilities in Shandong have been operating at a reduced capacity, and the concentrated release of demand has led to a significant increase in prices. The ex factory prices of tank trucks have rapidly risen, and cost support has significantly increased. The factory quotation for tank trucks has increased from 100-150 yuan/ton in early March to 100-400 yuan/ton. The resonance of the two major raw materials has led to a rapid increase in the cost line of dichloromethane.
2、 Overview of Export Impact: Nearly 1/4 of Export Scale Facing Shipping Risks
According to the 2025 dichloromethane export data statistics, the situation in the Middle East has had a significant impact on China’s dichloromethane exports, with clear characteristics of the impact:
Scale of impact: A total of 14 countries were affected, involving an export amount of 132 million yuan, accounting for about 22.3% of the total exports, and nearly a quarter of the export business faced shipping fluctuations.
Risk structure: Risks exhibit characteristics of “high concentration and prominent extreme values”. Türkiye, the United Arab Emirates, Saudi Arabia and Egypt together account for more than 90% of the affected amount, and are the main carriers of shipping risks; Iran, Israel, Yemen and other countries have a relatively low proportion of export value, but their performance risks are extremely high. Shipping companies refuse to ship, ship schedules are delayed, and port delays occur frequently, making it significantly more difficult to deliver orders.
Logistics impact: The restricted passage of the Red Sea and the Strait of Hormuz has led to a general delay of 10-15 days in related shipping routes, resulting in a significant increase in sea freight and insurance costs, directly driving up export costs. The pace of overseas arrivals has slowed down, and export shipments have been temporarily hindered.
3、 Market Contradiction: The Game between Cost Boosting and Export Suppression
The current dichloromethane market has formed a typical “double-edged sword” effect:
Positive support: high cost of methanol/liquid chlorine+generally low inventory of domestic enterprises+bullish market sentiment
Negative pressure: blocked demand in core export markets+rising logistics costs+uncertainty in overseas orders
If the export channel is blocked, the goods originally intended for export will be forced to flow back to China, increasing domestic supply pressure and in turn suppressing price increases.
4、 Future prospects
In the short term, the situation in the Middle East remains uncertain, and shipping risks and high prices of raw materials will continue to exist. The logic of cost support and export disturbance is not eliminated, and the price of dichloromethane is expected to maintain a strong trend. In the medium term, it is necessary to focus on the progress of shipping recovery, the strength of downstream demand recovery, and fluctuations in raw material prices. If geopolitical conflicts ease and export logistics recover, prices may gradually return to rationality, but the cost bottom has significantly increased, and the overall market center has significantly shifted upward compared to the previous period. If the situation in the Middle East does not ease, the impact of hindered exports will gradually become apparent, and port inventories may accumulate, suppressing the upward space for prices.
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