Price trend:

On December 10th, the diethylene glycol market continued its weak downward trend. Spot prices in East China closed at 3,040 RMB/ton, down 5 RMB/ton; and in South China at 3,200 RMB/ton, down 35 RMB/ton.

Fundamental analysis

Supply: During this period (December 9th-15th), Zhangjiagang was expected to receive 11,100 tons of cargo by ship. The total volume of cargo was relatively large. Based on the shipping schedule and the number of vessels, port inventory is expected to decrease slightly before increasing later in the week. As of December 9th, Fubao's inventory was 11,900 tons. Yangtze River port inventory figures were released every Monday.

Demand: Terminal demand had not shown any improvement. The average operating rate of domestic unsaturated resin factories remained at 37%, unchanged from the previous week. Traders were facing pressure in terms of shipments. On December 9th, the total shipments of diethylene glycol from two storage areas in Zhangjiagang amounted to 1,429 tons, a decrease of 229 tons compared to the previous day.

Costs: With some oil fields in Iraq resuming production, and the US continuing to push for peace talks between Russia and Ukraine, coupled with the ongoing atmosphere of increased production from OPEC+, international oil prices had fallen, weakening cost support.

Market Outlook

International crude oil prices were weak, and the fundamentals remained bearish. Due to the product structure, diethylene glycol prices were still prone to falling rather than rising. Industry sentiment was at a low point and difficult to improve. In the short term, the market may show signs of bottoming out and adjusting, but in the medium to long term, a new low cannot be ruled out.

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