September 4th news
September ethylene glycol prices hit a nearly 4-year high in China.
In 2026, the price of ethylene glycol has surged, reaching a new high in nearly four years. According to data, as of September 4, the average spot market price for oil-based ethylene glycol among Chinese traders was 6,370 CNY per ton, an increase of 64.85% from the average market price of 3,864.17 CNY per ton at the beginning of the year (January 1).
The spot price of ethylene glycol at East China ports has surged due to a sharp decline in incoming shipments, causing port inventories to drop to historically low levels. Supply is tight, and market basis premiums remain high. Today, spot contracts for delivery have been traded at a basis premium of +1150.
Port paper goods are mainly priced based on the basis, with prices closely following the fluctuations of the futures market. Recently, the futures price of ethylene glycol has risen significantly, and the basis quotes for port paper ethylene glycol by basis traders remain high and firm.
The ex-factory auction price for spot Chinese coal-based polyester-grade ethylene glycol (bulk water, tax included, self-pickup) is 6200-6400 CNY/ton. Currently, manufacturer quotations are relatively high, and traders who have stockpiled earlier can sell at lower prices with substantial profits.
Ethylene glycol port inventory at an extremely low level as of September 2026:
On September 3, 2026, the total spot inventory of monoethylene glycol in the main ports of East China was 139,000 tons, a decrease of 277,000 tons from the total spot inventory of 416,000 tons on July 30, 2026, in the main ports of East China.
Currently, the port inventory of ethylene glycol in China is extremely low, reaching a historical low.
Reasons for the Significant Increase in Ethylene Glycol Prices in 2026:
1. Increase in Demand: The demand for ethylene glycol in China has significantly increased, mainly due to the growth in the polyester fiber and polyethylene terephthalate (PET) industries. 2. Supply Constraints: There have been supply constraints in the domestic market, partly due to production disruptions and maintenance shutdowns at several major plants. 3. Raw Material Costs: The prices of raw materials, such as ethylene, have risen, leading to higher production costs for ethylene glycol. 4. Policy and Regulatory Changes: New environmental regulations and policies in China have led to stricter controls on production, resulting in reduced output from some facilities. 5. Global Market Influences: Global market dynamics, including international trade tensions and changes in global supply chains, have also impacted the prices of ethylene glycol in China.
Recent ethylene glycol prices have significantly increased. On one hand, geopolitical tensions in the Middle East have disrupted shipping, leading to a substantial reduction in imported supplies. Additionally, multiple coal-based production facilities in China have undergone concentrated maintenance, resulting in decreased domestic output. Port inventories in East China are at historically low levels, with insufficient spot buffer. On the other hand, the rising costs of crude oil and coal have increased production costs. The traditional peak season for polyester in the second half of the year has provided strong demand support, and market expectations of tight supply have driven inventory replenishment. These multiple factors have collectively contributed to the strengthening of ethylene glycol prices.
1. Geopolitical conflicts impact imports (core)
About 28% of China’s ethylene glycol is dependent on imports, and over 60% of these imports come from the Middle East. With the escalating U.S.-Iran standoff, shipping through the Strait of Hormuz has been disrupted, and production facilities in Saudi Arabia and Iran have either reduced output or shut down entirely, further hindering shipments. As a result, monthly import volumes have plummeted from the usual level of 600,000 tons to just 150,000 to 260,000 tons—a sharp contraction in supply. Moreover, shipping schedules are significantly delayed; even once navigation resumes, it will still take more than 25 days for cargoes to reach ports, making it extremely difficult to close the supply gap in the short term.
2. China's supply contraction
In July and August, multiple major coal-to-ethylene glycol plants in China underwent concentrated maintenance, involving a total capacity of over 3.5 million tons, leading to a decline in domestic production; after the oil-based plants restarted, their load ramp-up was slow, resulting in limited domestic output increase, which was insufficient to fully compensate for the import shortfall.
3. Port inventory has fallen to historically low levels.
East China's main port ethylene glycol inventory has rapidly decreased to a five-year low, with almost no buffer inventory. The tight supply of spot goods has significantly strengthened the basis, and even a small shortage could amplify the price elasticity of spot goods, driving the futures market to rise in tandem.
4. Cost increase
The Middle East conflict has pushed up international crude oil prices, and the increase in naphtha and ethylene prices has raised the cost of oil-based ethylene glycol. At the same time, coal prices are relatively strong, raising the cost of the coal-based route as well, providing a bottom support for prices and boosting the overall sentiment in the energy and chemical sector in China.
5. Downstream demand remains rigid, and market expectations are driving it.
In the second half of the year, polyester enters the traditional peak season, with stable demand from polyester factories; the market is concerned about the continuous tight supply, and traders and downstream players actively stock up and lock in goods, further exacerbating the tightness of spot supplies and amplifying the price increase.
Ethylene glycol price future trend forecast:
Short term (September–October): Geopolitical factors dominate, spot prices remain relatively strong, but upward room is limited.
The current port inventory in East China is at a five-year low. If shipping through the Strait of Hormuz does not significantly recover, and imports remain low, coupled with delayed shipping schedules, near-term spot prices will still have strong support and will maintain high levels of volatility. However, as prices rise, the profits of coal-to-chemicals and oil-to-chemicals plants in China will improve, leading to the gradual restart of maintenance facilities and an increase in domestic supply. At the same time, high prices will squeeze polyester profits, posing a risk of reduced production in the polyester and textile industries, which will constrain further price increases, gradually weakening the upward momentum. The biggest risk factor is the situation in the Middle East; if navigation resumes and the backlog of ships arrives, spot prices will quickly come under pressure and decline.
Mid-term (Q4): The price center of gravity will likely fall.
On one hand, as China's maintenance facilities fully resume operations and multiple large new production capacities are concentrated for release in the fourth quarter, domestic supply will significantly increase. On the other hand, once Middle Eastern shipping eases, imported goods will return, and ports will shift from destocking to inventory accumulation. Coupled with the peak season of "Golden September and Silver October" not meeting expectations, polyester production will decrease due to sustained losses, leading to the release of supply and demand pressure. The price center of ethylene glycol will decline, and the price premium brought by geopolitical factors will gradually fade.
Medium-to-long term (by 2027): The oversupply situation remains unchanged, and the valuation center is shifting downward.
This round of price increases is a temporary market trend caused by geopolitical disturbances and has not changed the overarching context of industry overcapacity. With continuous additions of new production capacity and limited growth in polyester demand, the overall supply pressure remains high. In the absence of significant new external shocks, prices are expected to return to a weaker oscillation pattern.
