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SunSirs: The Propylene Glycol Market Fell to the Bottom in Shock in 2022-Ⅱ
December 08 2022 09:50:28SunSirs(John)

Factors influencing propylene glycol market in 2022:

Demand: In 2022, the propylene glycol market gradually declined from about 16,400 RMB/ton at the beginning of the year to about 9,500 RMB/ton in the middle of the year, and then to about 7,700 RMB/ton in the fourth quarter. The propylene glycol market continued to decline significantly. It is mainly affected by demand. The trading atmosphere in the downstream UPR market was general, and the overall terminal demand was slowly boosted, the procurement of raw material was mainly based on demand. After centralized delivery of export orders, the accumulated warehouse of propylene glycol factory was under pressure and began to give up profits for shipment, and the market price gradually fell deeply.

In terms of exports: In 2022, propylene glycol market rose sharply twice in early May and early August, respectively. The main driving force for the rise was from the support of exports.

In the first quarter of 2022, due to the influence of international factors, the export volume of domestic propylene glycol to the Russian Federation decreased, which also affected the overall export direction of propylene glycol in the first quarter. In May, the export supply of propylene glycol recovered, and the export orders increased mainly in May. In addition to the influence of force majeure factors of Dow device in the United States, the supply was reduced, and the export was favorable. The increase of export orders drove the price of propylene glycol up.

According to the customs data, the export volume in May continued to hit a new high of 16,600 tons, up 14.33% month on month. The average export price was 2,002.18 US dollars/ton, down 13.33% month on month. The export volume to Türkiye was the largest, 1,779.4 tons. From January to May 2022, the cumulative export volume will be 76,000 tons, up 37.90% year on year. The proportion of consumption reached 37.8%, and the increase of export volume was also the main reason for this rebound.With the delivery of export orders, the follow-up of new orders with high prices was limited. In addition, the domestic market demand was weak in the off-season. The overall high price fell back in the middle and late June, waiting for the next cycle of export orders.

In the middle of August, the propylene glycol factory delivered export orders again, and the factory goods were tight and reluctant to sell. The propylene glycol market hit the bottom and rebounded, ushering in a wave of rising prices again.

Propylene glycol market forecast and outlook in 2023

In the fourth quarter of 2022, the domestic propylene glycol production capacity is on the high side as a whole. Towards the end of the year, the situation of supply exceeding demand in the propylene glycol market is hard to change, and it is expected that the market situation is weak.

After 2023, in the days before the Spring Festival, the propylene glycol market is expected to usher in a staged stock up, and the support of demand is expected to bring a wave of rising market prices to the market. After the Spring Festival, it is estimated that the downstream will need time to digest raw materials, and the market will enter the consolidation and operation. Therefore, it is expected that in the first quarter of 2023, the domestic propylene glycol market will be stable and sorting out after recovering from the trough. More attention should be paid to the changes in the information on the supply and demand side.

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