Deep Down, The Glycol Market Is Hard To Say.

Since October 2018, the domestic ethylene glycol market has been dropping steadily from 8000 yuan / ton to 4300 yuan / ton.

After entering May, the downstream terminal demand has not improved, and the port inventory in East China is still at a historical high level, and the short-term glycol market is hardly optimistic.

Operating rate has declined.

The continued decline of the market depressed the profitability of ethylene glycol, and the pessimism of polyester demand side continued. Ethylene glycol production enterprises took the initiative to reduce risks.

So far, the load of ethylene glycol has dropped to 63.38%, and the load of coal glycol has dropped to 50.07%.

In May, the loss of ethylene glycol in China was 169 thousand and 800 tons.

Domestic ethylene glycol operating rate chart

Wharf stock continued high

China is the largest consumer of ethylene glycol in the world. Although the prices in the European and American markets are stronger, due to the limited market capacity, a large amount of foreign resources are flowing into China.

In recent years, domestic load began to decline, and port shipments improved. Even so, by May 16th this week, East China's main port stock remained at 1 million 177 thousand tons.

In addition, in the next week, East China's main port still has 283 thousand tons of imported goods to be supplied. Combined with the recent delivery, the probability of accumulated inventory is still large, and the current situation of ample stock is still needed for some time.

Terminal orders are not in good condition.

After a peak in demand since April, the polyester plant has recently started a series of maintenance and reduction plans, and the polyester start rate has been low to 89.41% in the near future.

At present, the profit margins of polyester factories have been narrowed and raw material stocks are higher.

Polyester factories often use price reduction to promote sales. However, due to the negative impact of macro-economic and information, terminal demand is difficult to pick up. The wait-and-see mood is strong in the field, and the downstream only keeps the demand for small orders, and the market turnover atmosphere is light.

Among them, the overall confidence in downstream weaving and adding bombs is extremely scarce, and the new orders in the downstream have been significantly reduced.

Up to now, the price of PET bottle has dropped to 8000 yuan / tonne, making the market more bearish.

Comparison of domestic polyester comprehensive operating rate chart

To sum up: domestic ethylene glycol supply and demand at the same time to pressure the market, coupled with the help of macro information, so that the market price of ethylene glycol once again brushed the new low in the new year, the market decline is difficult to stop.

Although the market outlook is expected to rebound, the magnitude is still small.

Due to the serious imbalance between supply and demand, the trend of ethylene glycol decline has been difficult to reverse in the long run.

(source: LIAN, long Zhong information)