In just half a month, the spot price of ethylene glycol has increased by as much as 20%. The recent month futures contract has increased by more than 9%, and ethylene glycol, which has been silent for a long time, continues to heat up in the polyester industry chain.
In other words, this periodic surge is due to ethylene glycol being “willful” again? In fact, this is not the case. This time it is “doing its job” and everything is within the market’s expectations.
Rapidly rising in stages, ethylene glycol is hot again Got a handful
From December 1st to 18th, the spot price of ethylene glycol rose from 4,700 yuan/ton to 5,670 yuan/ton, an increase of 20.64%. In recent months, the price of ethylene glycol The 01 contract rose from 4,600 yuan/ton to 5,033 yuan/ton, an increase of 9.41%. Faced with the recent significant rise in ethylene glycol, industry insiders generally believe that although the rise has exceeded market expectations, the short-term upward trend is expected.
If you carefully analyze the current situation, the rapid rise in the market is not a big surprise for this variety.
According to GF Futures analyst Zhang Xiaozhen, ethylene glycol fell to around 4,000 yuan/ton from its launch at the end of last year to April this year, and port inventory once accumulated to more than 1.4 million tons. , at a historical high in recent years. Later, due to equipment maintenance and the increase in demand brought about by the high downstream polyester load, the inventory continued to decline. In September and October, the price quickly rebounded to 5,300 yuan/ton and then fell rapidly. Zhang Xiaozhen analyzed that ethylene glycol prices have remained at a relatively low level, mainly due to the expected impact of production capacity release. After mid-November, especially since December, port inventories have dropped to new lows in recent years. In addition, weather factors, port closures, cargo pollution and other incidents have led to scarcity of spot goods and insufficient liquidity. Under such circumstances, Hengli, The commissioning of new units at Yankuang and Zhejiang Petrochemical has been frequently delayed. It is understood that Hengli’s 900,000 tons, Zhejiang Petrochemical’s 800,000 tons and Inner Mongolia Yankuang’s 400,000 tons new units have not reached production on time. There is still no production capacity release, which exceeds market expectations. Previously, prices were suppressed to a certain extent due to excessive production expectations. The potential for upside is bound to lead to an increase in ethylene glycol prices.
The reporter learned that under the current situation of extremely low inventory, accidents have increased, which is why ethylene glycol has become popular again. A handful of main drivers.
“The market actually has certain expectations. The expected accumulation of ethylene glycol port inventory has not yet appeared. In a state of low inventory, it is more vulnerable to short-term uncertainties. Impacts, such as weather, shipping schedules, warehousing, etc., cause sudden tightness in supply, leading to sharp price fluctuations.” Dadi Futures analyst Jiang Shuopeng said.
In the view of Xu Li, an analyst at CITIC Futures, low inventory is currently the basis for supporting spot prices. Longzhong data shows that on December 16, the MEG port inventory in the main port area of East China was approximately 292,500 tons, a decrease of 31,600 tons from Thursday of the previous week, and a new low for the same period in the past five years. Polyester production and sales have increased this week, and the market’s tight sentiment towards spot goods has triggered price increases.
“The inventory of ethylene glycol ports is in the continuous destocking stage. In recent weeks, the overall arrival volume of ethylene glycol at the main port has not been low. However, due to weather factors, the port has been closed to traffic. Inventories remain in a destocked state, replenishment of market supply is limited, and spot supply is tight. At the same time, new domestic ethylene glycol devices still have to wait before they are stably put into production. The combination of multiple factors has caused the surge in ethylene glycol spot prices,” Jiang Shuopeng said.
The upstream is “turbulent” and the downstream is no longer “calm”
Boosted by the rise in raw materials, the price focus of polyester products has shifted upward as a whole. Polyester filament prices have increased by an average of 200-400 yuan/ton, and short fiber prices have increased by an average of 300–00 yuan/ton. “In terms of production and sales, the production and sales of polyester yarn in Jiangsu and Zhejiang have picked up recently, with heavy volume appearing from time to time. The downstream market as a whole has been boosted by the rising prices of raw materials. The market sentiment of buying up rather than buying down still has a certain impetus for downstream manufacturers to buy goods. In terms of inventory “The inventory of various polyester products has been significantly destocked recently. The decline in polyester production has caused a drop in the supply side. At the same time, the rebound in production and sales has driven destocking, and the inventory is at a low level during the same period.” Jiang Shuopeng said.
The reporter learned that the upstream raw material ethylene glycol is so “rising, all boats are lifted”, and the polyester filament market, which is the main force of downstream polyester, is no longer calm, with prices rising by up to 400 yuan per week. tons, and the quotations of various manufacturers have increased strongly. It can also be seen from the quotations of manufacturers in recent days that market confidence has been significantly boosted.
According to statistics from the China Silk City Network, as of December 18, the price of polyester yarn at a factory in Tongxiang increased by 100 yuan/ton, that of a factory in Huzhou increased by 50-100 yuan/ton, and that of a factory in Jiangsu increased by 50-100 yuan/ton. Polyester yarn from major factories rose by 100-300 yuan/ton, and FDY from a factory in Wuxi increased by 100-150 yuan/ton… On the 19th, polyester filament continued its upward trend, with various DTY products rising by about 50 yuan/ton, and polyester yarn from a factory in Zhejiang increased by about 50 yuan/ton. An increase of 50-100 yuan/ton…
Not only the prices of various varieties of polyester filament have risen strongly, but the mainstream production and sales of polyester have also been concentrated from time to time. In addition, Towards the end of the year, polyester manufacturers have stepped up maintenance efforts, which has added fuel to the rise in polyester yarns and greatly eased the inventory pressure on polyester manufacturers.
中文�The downstream weaving industry is still in a downward cycle, and downstream gray fabric yarn is still in a high-level destocking stage, which is expected to restrict the start-up of some new polyester production capacities. “In Jiang Shuopeng’s view, the medium and long-term supply and demand of ethylene glycol will shift from tight to loose, and the commissioning of new equipment and weakening demand will still restrict ethylene glycol prices.
According to the reporter’s understanding , although raw materials have begun to fall in the past two days, the downstream polyester filament market still maintains an upward trend. In this regard, Zhang Qiang said that because of the tradition of downstream stocking before the Spring Festival, and the current situation of weaving companies in some areas receiving orders at the end of the year, there has been a positive recovery Signal. “At the same time, judging from the current operating strategy of polyester factories, the chance of choosing a large price discount promotion becomes smaller. It may even take advantage of the factory’s Spring Festival maintenance situation to raise prices to bring positive feedback to production and sales. In this way, it can reduce the price during the Spring Festival. The situation of substantial accumulation of inventory. “In Zhang Qiang’s view, if there are no major changes in the upstream, the polyester filament market is not expected to fall sharply before the Spring Festival.</p