SunSirs: Global Ethylene Glycol Trade Flows Shift

According to China Chemical News, the ethylene glycol industry will confront a supply surplus in 2026, with manufacturers facing narrowed export channels and significantly compressed profit margins. Influenced by global trade frictions and trade protection demands from European producers, the global ethylene glycol market continues to experience supply-demand imbalances, particularly grappling with shifting trade flows.

Trade friction has completely disrupted the rhythm of U.S. ethylene glycol exports. In the first half of 2026, the core task for the U.S. ethylene glycol industry will be to absorb the excess capacity originally intended for export. However, traditional alternative markets such as Turkey, Egypt, and Western Europe have limited capacity and cannot absorb the previous export demand. S&P data shows that spot prices for Gulf Coast US ethylene glycol remained between 21.55 and 22 cents per pound in Q1 2025, before plummeting to an 18-month low of 18 cents per pound in April. Prices briefly rebounded in late May due to force majeure shutdowns at Lotte Chemical's Lake Charles, Louisiana plant, climbing back to 21 cents per pound on June 27. However, from July 3 to December 12, prices fell another 4 cents, a 21% decline, hitting a five-year low in December.

India's monthly ethylene glycol consumption averages approximately 40,000 tons. Although the Indian government has lifted import restrictions, U.S. producers believe it is unlikely to fully replace their original export markets. As oversupply intensifies and prices bottom out, non-integrated U.S. producers face mounting pressure to cut production, with some companies forced to halt operations to reduce inventories. Reports indicate at least two Gulf Coast producers have reduced operating rates, including one facility that has completely shut down.

Middle Eastern and North American (excluding U.S.) EG remains the primary supplementary source for East Asia due to cost advantages. Industry analysts note that sustained expansion of downstream polyester capacity in East Asia, coupled with the absence of U.S. supplies, may trigger structural supply-side imbalances. This could alter Asian EG trade flows, intensifying competition for resources between Asian and European markets.

The European market is focused on changes to anti-dumping duty policies. The anti-dumping duties imposed by the EU on US and Saudi EG in November 2021 are set to expire in November 2026, with a review likely to commence between May and August 2026. While the market widely expects the policy to be extended, the specifics of the duty rates remain uncertain. Should the EU lift tariffs on US industrial goods, the competitiveness of domestic products would be further weakened. Supply surplus remains a core challenge for Europe's 2026 EG market, with low-cost regions' supply impacting local producers. Unlike China, Europe's downstream EG demand for polyethylene terephthalate (PET) is unlikely to see significant recovery in 2026, indicating insufficient market rebound momentum.

As an integrated internet platform providing benchmark prices, on January 23, the benchmark price of ethylene glycol, according to SunSirs, was 3796.67 RMB/ton, a decrease of 1.75% compared to the beginning of the month (3864.17 RMB/ton).

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