The bullish atmosphere in the market during this period can be described as wave after wave. The upward trend of international oil prices is unstoppable. Among them, Brent has risen sharply for three consecutive days, with an increase of more than 9% for two consecutive days. The strong It’s hard to put into words that the situation in Russia and Ukraine has yet to show clear signs of clarity, and oil prices are still likely to rise in the future.
At the same time, news of the parking of multiple MEG devices overseas came out in the market:
U.S. Shell’s 250,000-ton unit is scheduled to be overhauled in March.
The shipment of Iran’s Farsa 400,000-ton unit in March was canceled for some reason.
A 720,000-ton unit in Taiwan is considering shutting down due to efficiency issues.
Cost support and changes in overseas equipment may affect later import volume expectations. As an important product in the chemical sector, ethylene glycol has also posted a positive trend for three consecutive days, bursting out with a surge within the day, and strongly breaking through the 5,500 round figure. Although not as high as crude oil, its performance was stronger than that of polyester chain-related products such as PTA and staple fiber. Looking forward, can ethylene glycol prices continue to move forward? Will the ethylene glycol boom come?
The short-term supply is good and the bull market continues. From the perspective of ethylene glycol supply, first of all, internal production is still in a declining stage. In addition, we must also pay attention to the supply situation of overseas oil processing equipment. Judging from the current price performance of various upstream varieties on the market, under the energy background of high oil prices and low coal prices, coal-based equipment may have high benefits, while oil-based equipment has relatively low benefits. At the same time, according to relevant data, some ocean-going equipment currently has corresponding load reduction actions, such as South Korea and Singapore. Specifically, the EG load reduction is about 20%. Generally speaking, there is currently no large-scale maintenance in the domestic market, and supply-side speculation is expected to be provided by the external market. Therefore, the sustainability of the supply increase is still open to question, and the short-term trend is bullish.
The polyester end production has increased, and demand has been driven by efficiency to follow up.
Judging from the performance of the demand side, the demand for ethylene glycol is in an expected state of gradual recovery, which may provide a certain boost to the current price speculation of ethylene glycol, and the related operating rate in March is still expected to remain high. Judging from the specific situation, the current operating rates of printing and dyeing, looms, and texturing in Jiangsu and Zhejiang are gradually returning to normal, and the demand for polyester downstream is increasing. And it is expected that the follow-up of raw material polyester in subsequent weaving is mainly based on rigid demand, and speculative demand is not obvious. In addition, after last week’s promotions, the pressure on polyester inventory has eased slightly. It is expected that the operating rate of polyester will remain high in March. Therefore, the high level of polyester will bring lift to the speculation of ethylene glycol prices, which will have an impact on the current price. form support.
Inventories continue to accumulate, and implicit pressure is slightly reflected
Finally, let’s look at the situation of ethylene glycol from the perspective of ethylene glycol inventory. From the inventory end, the inventory of ethylene glycol in the main port of East China was 945,000 tons on February 28, which is Monday, an increase from the same period last year. About 50,000 tons. As of now, the arrival forecast for this week is 175,000 tons. The arrival forecast has declined in the past two weeks, which means that the port continues to accumulate inventory and the implicit pressure is reflected.
Based on the above point of view, in the short term, due to the upward trend of crude oil and coal, coupled with the boost from the fundamentals of ethylene glycol, its price has an upward trend, and it is expected that there will still be some room for upside in the short term. Looking ahead, oil prices have experienced a sharp rise. We should pay attention to the risk of technical corrections that may arise. There is pressure on ethylene glycol inventory, and there may be some downside risk in subsequent corrections.
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