Ethylene glycol prices in Asia hit a low

Recently, a market consulting agency pointed out that the price of ethylene glycol in Asia fell to the lowest point in nearly two months. Market sentiment is likely to continue to be affected by the coming new supply. As of the week ended November 1, spot glycol prices in Asian markets closed at US $541-545 per ton (CFR, China's main port), the lowest level since September 6, according to anxins. With margins squeezed, some glycol producers in Asia and the Middle East have reduced the operating rate of glycol units, leading to a drop in Chinese glycol imports in September. A trader in Asia said: "based on current glycol prices, major suppliers do not have very high profit margins. We can see from China's latest import data that producers are cutting production amid weak earnings. " In the months to the end of the first quarter of next year, three new ethylene glycol units will be put into operation in Asia. Petronas Pangalan refinery and Petrochemical Company (pref Chem) will put into operation its 750000 T / a glycol unit by the end of the year. However, Hengli Petrochemical may put into operation its 900000 T / a glycol unit before the end of November. In the first quarter of 2020, Zhejiang Petrochemical also plans to put into operation a set of 750000 T / a glycol unit. Expected growth in regional supply has been dampening buying sentiment over the past two months. At present, the spot price of glycol in Asian market is higher than the forward price, indicating that there is a spot premium since the end of October. A major glycol importer said sentiment could be more pessimistic in the coming weeks, given expectations that new supplies will hit the market and that interest in buying goods in December has waned. The glycol market also faces a slowdown in downstream polyester demand. Some of China's major polyester factories are cutting production in response to rising inventories and falling profit margins. On November 1, the average operating rate of China's Polyester plants fell to 86% from 89% a month ago, according to anxins. In early November, China's filament yarn inventory increased from 2-20 days in early September to 10-24 days. Many factors affect China's exports of manufactured goods, including textiles and clothing. These products are mainly made of polyester yarn and fiber. "The end of the year is usually the off-season for the polyester industry because downstream processors have completed export orders," said a Chinese polyester producer .