Ethylene Glycol Prices Soar by 36.12% in March

March 20 news

In March, the price of ethylene glycol in China surged by 36.12%.

In March 2026, the price of ethylene glycol stopped falling and surged. According to the data, as of March 20th, the average price of oil-based ethylene glycol in China was 5,170 CNY/ton, an increase of 36.12% from the average price of 3,798 CNY/ton on March 1st.

Regarding port ethylene glycol, as of the 20th, the spot contract basis quotes for port ethylene glycol (starting at 500 tons) have been fluctuating along with market prices. This week, intraday basis quotes for spot contracts have ranged from -60 to -30. At closing, the basis quotes for the March contract (before March 25) were between -35 and -30; for the contract expiring the week after next (before April 3), the basis was quoted at -21 to -15; and for the April contract (before April 25), the basis ranged from -90 to -85. For the March contract (before March 25), the basis was quoted at -40 to -35, while for the April contract (before April 25), the basis was quoted at -30 to +0. Currently, prices are at a high level, the basis is experiencing significant fluctuations, and trading activity remains relatively weak.

The spot price of coal-to-polyester grade ethylene glycol in China (bulk, tax included, self-pickup) for factory pickup is 4250-4500 CNY/ton.

In terms of foreign ethylene glycol, as of March 19, the recent cargo arrival price was discussed and traded around $627 per ton.

March 2026 Changes in Ethylene Glycol Port Inventory:

On March 19, 2026, the total spot inventory of monoethylene glycol in the main ports of East China was 933,000 tons, an increase of 6,600 tons from the total spot inventory of 926,400 tons on March 2, 2026, in the main ports of East China.

Analysis of the Reasons for the Significant Increase in Ethylene Glycol Prices in March:

In March 2026, the price of ethylene glycol rose significantly, rebounding markedly from the low at the beginning of the month. The market quickly shifted from a loose supply-demand balance to a tight balance. The core drivers of this round of market performance were the geopolitical conflicts in the Middle East, which led to a reduction in import supplies, combined with the concentrated load reduction during the spring maintenance in China, the increase in crude oil and naphtha costs, and the support of rigid demand from the resumption of downstream polyester production. The resonance of supply and demand and cost factors pushed prices up, and in the short term, the main drivers of the market will still be the geopolitical premium and the destocking trend.

Core Driving Factors Analysis

1. Geopolitical conflicts take center stage: Supply disruptions in the Middle East lead to a sharp drop in import expectations.

China’s dependence on imported ethylene glycol stands at around 28%, with more than 65% of these imports coming from the Middle East. Saudi Arabia accounts for over 55% of these supplies, while Iran contributes approximately 13%. The majority of these shipments are transported via the Strait of Hormuz.

Shipping Disrupted: The efficiency of shipping through the strait has decreased, insurance costs have risen, and there are delays in ship schedules. Expectations for arrivals in March and April have been significantly revised downward.

Facility disruptions: Oil and gas facilities in the region have been affected by the conflict, with some overseas facilities reducing output, halting operations, or declaring force majeure, thereby disrupting global supply flows.

Structural gap: High-end fiber-grade supplies depend on the Middle East, and the reduction in supply has created a rigid gap, supporting an upward shift in the price center.

2. Supply-side contraction: Synchronous reduction in load outside China, initiating a destocking cycle.

China's equipment undergoes centralized spring inspections.

Coal-to-ethylene glycol: In March, it enters a concentrated maintenance period, with multiple units shutting down or reducing load, leading to a month-on-month decrease in the coal-to-ethylene glycol production rate.

Oil-based ethylene glycol: The prices of naphtha and ethylene have surged, leading to high costs that force companies to reduce production, resulting in a significant loss in daily output.

The industry’s overall utilization rate has dropped to around 66%, and China’s supply side continues to contract.

Inventory turning point appears

The growth momentum of inventories in the main ports of East China has been curbed. With the subsequent reduction in imports and the recovery of domestic demand, it is expected to enter a phase of accelerated destocking, providing fundamental support for prices.

3. Cost support: Strengthening of oil and gas, restructuring of process spreads

Brent crude oil broke through $100 per barrel, and naphtha and ethylene surged in tandem, sharply driving up the cost of producing ethylene glycol from petroleum, thus creating strong cost support.

Thermal coal prices remain relatively stable, the cost advantage of coal-to-ethylene glycol has widened, industry profitability is recovering, and this further supports the bottom of the market.

4. Demand-side support: Release of resumption of work necessities, and rising expectations for the peak season in China.

After the Spring Festival, the downstream polyester and weaving industries in China have fully resumed operations, with polyester load steadily recovering to over 85%, and rigid demand continuously being realized. March and April are traditionally peak seasons, during which the recovery of orders and the demand for restocking resonate, alleviating the supply and demand pressure brought about by the contraction in supply, and providing a demand base for price increases.

5. Capital and Sentiment: As expectations of a supply crisis continue to build, long positions are being actively increased.

Geopolitical conflicts trigger a trading logic of supply tightening, with both trading volume and open interest in the futures market increasing simultaneously. Capital inflows accelerate price increases, forming a positive feedback loop of "expectation - capital - price."

3. Future Market Outlook and Key Focus Points

Short term (1-4 weeks): The situation in the Middle East, shipping traffic through the straits, and developments in overseas facilities are the key variables. Supply premiums remain, and prices continue to run relatively strong.

Mid-term (1-3 months): Focus on the intensity of maintenance activities in China, the sustainability of polyester demand, and the pace of inventory reduction at ports. The tight balance between supply and demand is expected to persist.

Risk factors: Easing geopolitical tensions, imports arriving at ports exceeding expectations, downstream demand falling short of expectations, and a pullback in crude oil prices.