The price of ethylene glycol decreased in September
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In September, the price of ethylene glycol began to decline and stabilized at the end of the month. According to data from Shengyi Society, as of September 27th, the average price of domestic oil to ethylene glycol was 4525 yuan/ton, a decrease of 3.28% from September 1st.
On September 27, 2024, the operating price of ethylene glycol at the port was between 4500-4540 yuan/ton, and the basis of spot contracts did not change much during the day. In October, the basis quotation was+38 to+43 yuan/ton; The base price for November is+42 to+46 yuan/ton.
On September 27th, the price of coal to ethylene glycol remained stable, with prices in the northwest region ranging from 4180-4300 yuan/ton, including taxes.
On September 26, 2024, the external price of ethylene glycol was as follows: the landed price in China was $540/ton, and the landed price in Southeast Asia was $535/ton.
Overview of Ethylene Glycol Fundamentals
Cost wise: Saudi Arabia is preparing to abandon its unofficial oil price target of $100 per barrel and increase production to regain market share. Additionally, two OPEC+sources have stated that the organization will increase oil production in December. International crude oil production is expected to increase, and the cost of producing ethylene glycol from oil has loosened. Coal to ethylene glycol has recently stabilized due to the stabilization of coal prices and cost recovery, but its absolute value is still relatively low.
On the import side, ships that were delayed due to typhoon weather in the early stage have gradually docked at the port, and the recent arrival volume at the port has increased.
Port inventory: As of September 26, 2024, the total spot inventory of ethylene glycol in the main ports of East China was 553400 tons, a decrease of 119900 tons from the total spot inventory of ethylene glycol in the main ports of East China on August 29, which was 673300 tons; Compared with the total spot inventory of ethylene glycol at the main port in East China on September 23, which was 512600 tons, the inventory increased by 40800 tons.
Future expectations
Recently, the price of ethylene glycol has stopped falling and rebounded, mainly due to the positive domestic macro conditions driving up the price of coal, and the cost of coal to ethylene glycol has changed; In addition, the polyester sector has been affected by macro sentiment and has stopped falling and rebounded.
However, the cost of producing ethylene glycol from oil is still in a downward trend due to the influence of international crude oil prices, and there is no sign of a stop to the decline in the short term. In addition, there is an expectation of a weak peak season in downstream polyester demand, and it is expected that the price of imported ethylene glycol, which has a high correlation with futures, will have weak upward momentum. The domestic macro sentiment has a significant impact on current prices, and if international crude oil prices do not rebound, the price of ethylene glycol in October may mainly fluctuate weakly.
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