There is a significant upward trend in the price of ethylene glycol in stages
In mid to late June, the price of ethylene glycol rebounded and continued to maintain a strong upward trend. According to data from Business Society, as of July 8th, the average price of domestic oil to ethylene glycol was 4665 yuan/ton, an increase of 3.72% compared to the average price of 4497.5 yuan/ton in the East China market on June 19th. The prices for each region are as follows:
The price range for spot goods executed by mainstream manufacturers in East China is between 4600-4850 yuan/ton; The spot price of ethylene glycol in the South China market is 4600 yuan/ton, while the mainstream spot manufacturers in Central China have a price range of 4500 yuan/ton for external execution; The mainstream manufacturers in North China offer a spot price of 4600 yuan/ton for external transactions.
On July 8, 2024, the spot basis quotation for ethylene glycol at the port was close to the forward basis.
At present, the price of coal to ethylene glycol is relatively low, with a price range of 4000-4250 yuan/ton, including taxes, leaving the factory.
Port cargo capital speculation is the main reason for this round of upward trend
The first wave of upward trend from December 2023 to March 2024 due to market speculation on port inventory levels was due to the decrease in explicit port inventory from 1.2 million to 700000 tons, and the market price rising from around 4000 yuan/ton to 4800 yuan/ton. Recently, due to the downstream short fiber market, manufacturers have joined forces to boost prices, and ethylene glycol has also started to hype up inventory news. Currently, inventory has decreased from 740000 tons in the early stage to 670000 tons, and the price of ethylene glycol has also increased from 4400 yuan/ton to over 4700 yuan/ton, with significant results. At present, the price is close to the previous high, and the sustainability of the speculation needs further observation.
Weak actual demand for polyester constrains continued upward space
Returning to actual supply and demand, the overall production and sales of the downstream polyester industry are weak. The production and sales of polyester in Jiangsu and Zhejiang are around 30%, and manufacturers have a strong willingness to raise prices. However, there is not much actual terminal procurement, and it is difficult for high-level raw materials to rise. The downward transmission of pressure is hindered, and some downstream terminal enterprises mainly maintain early orders and replenish inventory for urgent needs. The terminal demand is not strong, and the raw material side unilaterally increases prices, resulting in poor sustainability.
Domestic production of ethylene glycol rebounds
At present, the price of ethylene glycol has risen to a relatively high level, and the domestic operating rate has begun to recover. In addition, there is an expectation of an increase in the amount of ethylene glycol arriving at ports in China and abroad in July, and there is a short-term growth expectation on the supply side.
Cautious and optimistic outlook on the future market of ethylene glycol
At present, the price has risen to a relatively high level, and the inventory factor in the early stage has basically been realized at the price level. Currently, downstream polyester is reducing production and maintaining prices, coupled with lower than expected terminal demand in the weaving industry, the industry is weak, and demand is not strong; There is an expectation of an increase in the supply side, and in the short term, the price of ethylene glycol is at a stage high state. The future market is cautious and optimistic.
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