Where Is The Downward Trend Of Ethylene Glycol?

Yesterday, under the influence of the external negative impact, ethylene glycol futures were on the decline, and the center of gravity of the stock market was going down. In the east part of the stock market, the spot traders talked about 4260 yuan / ton. At present, the market was attacked by internal and external markets, and the market participants were short of confidence.

Raw end support Limited

In August, international crude oil prices showed a general trend. On the one hand, US crude oil stocks will continue to decline during the peak summer consumption season, and the drop in inventory will give the crude oil price a certain bottom support; on the other hand, based on worries about the global economic downturn and international trade disputes, crude oil will have a limited upward trend.

Supply will increase slightly.

In the short term, the supply of domestic glycol is decreasing, and the main port stocks are in a healthy decline. The recent arrival of goods in Hong Kong is decreasing. However, after the seasonal factors, the volume of port arrival will gradually return to normal, and the profits of enterprises will still be depleted.

At present, the upward trend of the market is hindered, the delayed start time of the maintenance enterprises is delayed, the normal production enterprises reduce the burden (reduce the contract volume), or the device performs the rotation inspection. However, in the middle and later 8 months, the supply will be improved with the recovery of the MEG device and the increase of import volume.

Domestic ethylene glycol operating rate chart

Slow recovery of downstream demand

Downstream polyester operating rate narrowed to around 85%, and production and sales continued to slump, and from the external news side with the Federal Reserve cut interest rates boots landing, the first rate cut in more than 10 years is lower than expected, the market expects the long term easing period has not yet begun, coupled with the worsening Sino US trade situation, the terminal grey cloth inventory is high, demand is difficult to have obvious improvement.

At present, polyester prices are low, low price promotion of enterprises, polyester stock prices began to decline, but it is expected that in the terminal demand downturn, polyester removal speed is relatively slow.

To sum up: at present, downstream polyester demand is still negative market sentiment, coupled with the expected increase in port stock when the volume of Hong Kong is increasing, but the overall start-up of ethylene glycol remains low, and the increase in port inventory is also short-lived, and its trend obviously belongs to the situation of insufficient power and limited space. Therefore, it is expected that short-term ethylene glycol will maintain low order market. (source: Guo Ye net, founder metaphase)