Introduction: In 2022, the international crude oil market will be in a situation of supply exceeding demand for most of the time, especially in the first half of the year. Therefore, oil prices may remain at a high level, while supply and demand bias will occur in some areas of the coal market during peak hours. Tight, coal prices will fluctuate at high levels, and ethylene glycol will have strong cost support. However, due to the increase in supply and the maintenance of rigid demand, prices may still be expected to rise throughout 2022.
Looking back on 2021, China’s ethylene glycol market will maintain a volatile trend. With the frequent outbreaks of public health incidents, the downstream and terminal weaving industries of ethylene glycol have been in a state of low demand for a long time, causing the industry chain to experience a sluggish peak season. In addition, due to the impact of power restrictions and coal shortages during the year, the overall production of ethylene glycol has started The load is not high. Secondly, ethylene glycol production capacity expanded rapidly during the year, with ethylene glycol production capacity increasing by 5.34 million tons, and port inventories have remained fluctuating around 500,000-700,000 tons. Moreover, the world situation is complex and uncertain factors are increasing. Crude oil and coal have a strong impact on the mentality of ethylene glycol. Moreover, the current low-valued market price of ethylene glycol has penetrated the cost price of coal-making technology and methanol-making technology. During the year Coal-to-coal and methanol-to-ethylene glycol are even more difficult to produce, causing delays in the start-up of some coal-to-coal companies.
Figure 1 Trend chart of major domestic ethylene glycol markets in 2021, data source: Zijin Lianchuang big data intelligent decision-making system
The ethylene glycol market trend forecast in 2022 is as follows:
From the supply and demand side: The growth rate of ethylene glycol will slow down slightly in 2022. New production capacity is expected to be 5.7 million tons in 2022. China’s ethylene glycol production capacity is expected to reach 26.555 million tons by the end of 2022, and the annual output is expected to reach 18.6 million tons. , based on the import volume of 7 million tons, the total supply during the year may reach 25.6 million tons. However, the growth rate of downstream demand is limited. In 2022, polyester production capacity is expected to be 74.585 million tons, and demand for ethylene glycol is 24.986 million tons. It can be seen that there will still be an oversupply of ethylene glycol in 2022.
From a price point of view: in the first quarter, with the commissioning of two new large-scale integrated units of Zhenhai Refining and Shenghong Petrochemical, the contradiction between supply and demand began to become prominent. Port and corporate inventories are expected to increase. It is expected that the price of ethylene glycol may fall back. In March, supply and demand slowly recovered, and ethylene glycol gradually entered the accumulation stage. Imported goods gradually arrived at the port, adding to the pressure on market supply. The decline of ethylene glycol is expected to continue until July, and starting from August, it will gradually approach the gold, silver and silver prices. During the peak season of October, downstream polyester may stock up in advance, and prices may rebound. However, while supply pressure remains, prices will rise weakly, and imported and domestic supply may increase the market supply burden. November and December are approaching the end of the year. , the market may continue to lack positive support and maintain a volatile trend.
Generally speaking: the gap between ethylene glycol supply and demand will still widen year by year in 2022, and excess supply will become an important factor restricting the price increase of ethylene glycol for many years. It may continue to show slowdown in production capacity growth, replacement and upgrading of downstream products, and price decline. Trend characteristics such as continuous fluctuations.
</p
