Introduction: As the traditional peak season of the Golden Nine and Silver Ten approaches, the ethylene glycol market gradually comes out of the trough. So is the rise of ethylene glycol a short-lived flash in the pan or is it supported by the market?
As the public health epidemic in Europe eases, the demand for ethylene glycol in Europe increases, driving up market prices in Europe Higher; compared with domestic market prices, European ethylene glycol prices are more attractive; in addition, India’s polyester production is large, and India’s unblocking has also increased its demand for ethylene glycol, and global ethylene glycol has flowed into Europe, India, etc. increase.
Judging from the overseas maintenance situation, two sets of Dow equipment in Canada are scheduled to undergo maintenance in mid-August and early September, and four sets of equipment in Taiwan Nanya will undergo inspections from July to September. plan. U.S. Shell also reported a maintenance plan in September. It can be seen that the supply of domestic imported goods may shrink significantly.
Judging from the situation of domestic factories, the current comprehensive operating rate of ethylene glycol is 52.16%, of which the operating rate of petroleum production is 64%, and the operating rate of coal production is 29.76%. Coal-making process profits have suffered significant losses, coal-making plants have been shut down for large-scale maintenance, and the operating load has bottomed out, dragging down the overall operating load in the country. From the perspective of domestic supply and demand balance, if coal production capacity is eliminated, domestic ethylene glycol can just maintain the balance of supply and demand, and there may even be a situation where supply exceeds demand to a certain extent. As market prices rise and coal-making process profits recover, some low-cost coal-making plants are bound to be more willing to restart. In order to suppress the coal chemical industry, the upside potential of the ethylene glycol market is still limited by the cost of starting coal production.
From the downstream and terminal point of view, as the Golden Week and Silver Ten are approaching, terminals have successively received orders for autumn and winter. The foreign trade market has also begun to improve after gradually adapting to the changes in the international situation, especially in autumn and winter. The arrival of fabric orders gradually opened up the situation, and sales began to improve. Although gray fabric inventories still remain at a 45-day high, the expected improvement in terminals supports the operating load of polyester factories to remain at a high level. Although affected by the epidemic, this year’s peak season for the Golden, Nine and Silver Ten seasons is not as good as in previous years, it will still be a flash point this year.
Taken together, at this stage, the ethylene glycol market is in a confrontation between the expectation of marginal improvement in supply and demand and the pressure of high spot inventory, and the market is in a turbulent climb of two steps forward and one step back. stage. With the gradual advancement of the Golden Nine and Silver Ten, if the expected improvement in supply and demand can be gradually realized, the market price may reach the 4,000 yuan mark again. However, we still need to be wary of the negative pressure on the market caused by the release of new ethylene glycol production capacity in September and October. </p
