Foreign crude oil plummeted, and ethylene glycol cost support was weak

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Foreign crude oil plummeted, and ethylene glycol cost support was weak

Ethylene glycol prices fell in October

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In October, ethylene glycol prices first rose and then fell. After a rapid increase after the holiday, sentiment subsided and prices gradually fell. According to data from Sino-Trade, as of October 28, the average price of domestic oil-based ethylene glycol rose by 2.39% compared with September 26.

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On October 28, 2024, the basis of the port ethylene glycol spot contract loosened slightly during the day. The market was low at the beginning and high at the end. The actual contract spot transaction price rose slightly in the afternoon, but the transaction was small, and the main focus was on low-hanging goods. The opening price of the spot contract this week was +40 to +43 in the morning trading today. The basis of this week fell to +38 to +40 in the afternoon trading, and the basis of November was +40 to +43.
The foreign crude oil plummeted, and the cost support of ethylene glycol was weak.
One of the factors for the recovery of ethylene glycol prices at the beginning of the month was the low port inventory of imported ethylene glycol and the cost support brought by the recovery of foreign crude oil prices. However, today’s foreign crude oil opened with a drop of 4-5%, and the cost support of foreign ethylene glycol weakened.

Port inventory recovery is still expected

The visible inventory data of ethylene glycol at ports is still at a relatively low level, but the volume arriving at ports is expected to increase in the near future. The weekend delivery was good and the inventory did not continue to accumulate, mainly because the October contract was transferred and picked up at the weekend; as of October 28, 2024, the total inventory of ethylene glycol at major ports in East China was 603,700 tons, an increase of 88,500 tons from 515,200 tons on October 14. The expected volume of ethylene glycol arriving at ports this week is large, and port inventory is still expected to rebound.

Domestic supply rebounds

On the supply side, affected by the price recovery factor in the early stage, the total operating rate of domestic ethylene glycol began to pick up, the operating rate of domestic ethylene glycol increased slightly, and the output rebounded.

On the demand side: the downstream polyester load is high, and the filament maintains a high operating load, with basically no room for further improvement. The terminal autumn and winter orders are still lower than expected in the near future, and there is no improvement in the short term.

Market outlook

The previous surge in ethylene glycol prices was mainly due to the domestic macroeconomic benefits and the low port supply; coupled with the resonance of the polyester sector price increase, ethylene glycol prices climbed to the highest level of the year.

Recently, international crude oil prices have weakened, and the cost support is weak. In addition, the port is concentrated, and the inventory data has changed its trend upward in the short term, and ethylene glycol prices have begun to fall.

The future ethylene glycol price variables mainly lie in overseas supply and cost support. It is expected that ethylene glycol prices will fluctuate and run weakly in the short term.

 


Post time: Oct-29-2024