Industry news

At the end of 2024, the price of ethylene glycol fluctuated upward. Data show that on December 31, 2024, the benchmark price of ethylene glycol was 4666.67 yuan (ton price, the same below), an increase of 1.63% from the beginning of the month. According to statistics, at the end of December 2024, the average market price in East China was 4,845 yuan, with a month-on-month increase of 2.5%.

This ethylene glycol at the end of the year carry-over market, mainly due to the port inventory decline, Iran's energy problems and other factors to support the end of the year ethylene glycol market strong rise, prices hit a new high in the year. Business analysts believe that the recent price shock of ethylene glycol is strong, mainly due to the polyester start more than expected, and the impact of the Iranian news at the import end, and the price support is strong.

Demand increases and supply tightens

Marketers who have tracked the trend of ethylene glycol for a long time pointed out that the low price of ethylene glycol in recent years is mainly due to the global economic slowdown, weakening demand in major economies, and oversupply caused by the substantial growth of production capacity in recent years. In 2024, due to the decline in the construction of early installations, the low port supply, and the joint boost of downstream demand, the improvement of supply and demand in the ethylene glycol market, the overall state of tight balance, promoting the price shock higher, and the formation of three band highs in February, July and October, a slight correction in the middle, and the end of the year again.

Analysts believe that this wave of carry-over at the end of the year is mainly caused by increased demand and tight supply. From the point of view of demand, affected by domestic stimulus consumption and favorable exports of the depreciation of the renminbi, the main downstream polyester production load of ethylene glycol in December 2024 was maintained at about 90%. From the production side, in December 2024, Inner Mongolia Jianyuan coal chemical Technology 260,000 tons/year device, a set of 380,000 tons/year device in Saudi Arabia, and a set of 750,000 tons/year device in Malaysia were stopped for some reason, resulting in tight supply. From the import point of view, the arrival of imports is less than expected, and the glycol inventory in East China port in December 2024 fell to about 460,000 tons, a decrease of 93,000 tons from the previous month.

Start recovery profit repair

With the high price of ethylene glycol, the combination of cost end ethylene prices and coal prices weakened, ethylene raw materials and coal-based raw material ethylene glycol manufacturers profit and cash flow have been repaired, giving enterprises a strong confidence. According to the analysis data, the gross profit after tax of the coal-based syngas glycol industry is about 660 yuan/ton, but the naphtha, ethylene and MTO glycol industry is still a significant loss, of which the MTO method loss is 1960 yuan/ton.

Profit repair to pull ethylene glycol operating rate has also rebounded, at a seasonal high. In December 2024, the operating rate of the domestic syngas glycol industry is about 65%, the ethylene glycol industry is about 70%, and the naphtha glycol industry is about 85%.

Affected by the imbalance between supply and demand, coal prices continued to fall, while naphtha and ethylene prices were driven by the supply side, and they also fell slightly in the near future, and the overall cost of ethylene glycol sank as a whole.

In 2024, ethylene glycol imports decreased, demand increased, and the inventory reached the highest level in recent years. The recent ethylene glycol apparent inventory data is relatively low, on the one hand, because the port inventory does not include the hidden inventory of domestic production areas and factories; On the other hand, it is also because the downstream manufacturers are fully stocked when the price is low in November, and the recent port is affected by the weather, and the dock is blocked and discharged slowly.

Late shock weak operation

At the same time, the industry pointed out that the supply and demand fundamentals of ethylene glycol are weak, suppressing the upward price space. Recently, the price of crude oil is at a low level, the cost support is relatively insufficient, the domestic coal price is in the downward channel, and the cost of coal to ethylene glycol has an advantage. At present, the apparent inventory of the port is expected to grow, while the absolute data is at a relatively low level, and the short-term ethylene glycol price is mainly volatile and weak.

Business analysts believe that glycol terminal demand as a whole is expected to weaken. Affected by the annual leave factors, in January the terminal manufacturers will gradually enter the state of holiday shutdown, polyester gradually accumulated, the recent downstream filament, bottle manufacturers have begun to release maintenance plans, downstream operating rates have shown signs of decline.

For the ethylene glycol market, it is recommended to pay attention to three fundamentals: First, the supply side, the domestic ethylene glycol production is expected to rebound, the coal chemical operation rate is high, and the total supply is expected to increase slightly, and it is expected to be 1.7 million to 1.72 million tons in January. The second is the demand side, polyester production and sales contraction, the seasonal opening probability of the terminal weaving field is slightly compressed, and the inventory of polyester factories is rising. The third is the import volume, with the subsequent unloading of ocean ships and arrival at the port, the dominant inventory or a rebound, from the current arrival forecast of the main port, it is expected that imports will rise to more than 600,000 tons in January, the accumulation of the port dominant inventory in early January gradually cash.

In 2025, ethylene glycol will be a wide shock market, and there will be an obvious mismatch between supply and demand during the centralized maintenance period of enterprises, and the price is expected to break through the pressure level of 4800 to 4900 yuan in 2024. However, because there is room for supply to return, on the one hand, the new supply pressure of ethylene glycol is slightly greater than 2024, and the capacity utilization rate of the industry under the profit repair pattern also has some room to improve, and the growth rate of downstream polyester demand is expected to further slow down, so when the valuation rises, the high profit of ethylene glycol is difficult to continue to maintain.