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SunSirs: The Price of Ethylene Glycol Continued to Rise (February 8-20)

February 22 2021 13:41:43     SunSirs (John)

Price trend

According to data from SunSirs, on February 20, the average ex-factory price of oil-based ethylene glycol was 5,053.33 RMB/ton, an increase of 236.66 RMB/ton or 4.91% from before the holiday.

On February 20, the market price of ethylene glycol in East China was 5,100 RMB/ton, an increase of 250 RMB/ton from the beginning of the month, an increase of 5.15%.

Analysis review

On February 20, the total inventory of MEG ports in East China this week was 596,500 tons, and the ports continued to destock.

The current ethylene glycol operating rate is about 66%, and the polyester operating rate is about 82%, which is slightly higher than the pre-holiday operating rate.

In terms of equipment, domestic: Affected by the high profit of ethylene glycol, the co-production equipment was adjusted to reduce EO to meet the requirements, the production of ethylene glycol was changed, and some production lines of Xinhang Energy were overhauled. Overseas: Lotte’s 700,000 tons of MEG temporarily shut down; the 828,000 tons of ethylene glycol plant in South Asia was shut down due to power failure; affected by the extreme cold weather, the 750,000 tons ethylene glycol and 250,000 tons ethylene oxide plant of MEGlobal in Texas was shut down; the 380,000 tons ethylene glycol plant of Indorama in Texas was shut down; LyondellBasell’s 365,000 tons ethylene glycol plant in Texas was shut down; the 750,000 tons ethylene glycol plant in Freeport, Texas shut down; and the 380,000 tons EO/MEG plant in Lake Charles, Louisiana shut down.

Market outlook

The U.S. suffered from extreme weather. Unexpected shutdowns of multiple installations caused the supply side to shrink. The price of MEG external disks continued to rise. Although at present, the impact of frost weather is gradually weakening, due to the negative effects of extreme weather and the lagging effect of shipping schedules on domestic supply, it is expected to weaken the expected arrivals in March and April. The post-holiday situation on the domestic market demand side is relatively optimistic, the spot price of ethylene glycol has soared. As international oil prices continue to rise, domestic coal-to-ethylene glycol profits have become prominent, and manufacturers have increased their ethylene glycol load. According to market participants, the current profit of ethylene glycol is 700 RMB/ton higher than that of ethylene oxide. In addition, the port desalination continues, and the market sentiment is positive, and it is still bullish in the short term.

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