Price trend

On February 26th, the diethylene glycol market fluctuated weakly, with spot prices in East China closing at 3,205 RMB/ton, down 25 RMB/ton; and in South China closing at 3,300 RMB/ton, with market prices remaining stable. Downstream resumption of work and production after the holiday was generally slow, and there was a lack of actual transactions in the market.

Fundamental analysis:

Supply: As of February 23, the port inventory of diethylene glycol in East China was 52,100 tons, an increase of 9,300 tons compared to the previous period. This week (February 24 - March 2), 14,787 tons of diethylene glycol are expected to arrive at Zhangjiagang Port, a significant increase in expected arrivals. However, there has been some restocking activity in the market after the holiday, and with downstream industries gradually resuming work and production, port shipments may increase. Therefore, the inventory change at major ports in East China this week is not expected to be significant.

Demand: Downstream demand remains to be recovered. Unsaturated resin plants gradually resumed operations during the week, with the average operating rate of domestic unsaturated resin factories at 15%, a decrease of 5 percentage points compared to before the holiday. The slow resumption of work and production is putting pressure on traders to ship their products. On February 25th, the total shipment volume from the two warehouses in Zhangjiagang was 496 tons, an increase of 68 tons compared to the previous day.

Costs: U.S. commercial crude oil inventories rose more than expected, coupled with a generally cautious market sentiment ahead of the U.S.-Iran talks, resulting in mixed international oil prices.

Market Outlook:

Recent port arrivals have been concentrated, while downstream resumption of work and production has been slow, leading to a strong expectation of inventory accumulation at major ports. With numerous external uncertainties and a lack of substantial market drivers, the diethylene glycol market is expected to maintain a volatile pattern in the short term, with downstream purchasing sentiment remaining cautious.

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