Cost Push The End Of Ethylene Glycol Adjustment Pressure Highlights

Since June, the performance of international crude oil has been strong, and the US crude oil once broke through the price of 40 US dollars / barrel, which basically compensated for the gap between the outbreak and the price war. However, the impact of the epidemic has not ended yet. After the price rises, the oil producing countries' attitude to reduce production has once again become divided and other factors. On the back of the trend, the main raw materials of ethylene glycol fell accordingly, and the naphtha naphtha, which was highly related to crude oil, had the largest adjustment, from 371 US dollars per ton in the month to 337 US dollars / ton in June 12th, down by 9.16%, but naphtha still recorded a 13.25% increase. The spot price once surged to the price of 3700 yuan / ton, but then showed a weak performance. In June 12th, the closing price was 3500 yuan / ton, which was 1.82% lower than that at the end of May. The rise and fall of naphtha technology resulted in a sharp decline in the profits of naphtha technology, which turned from the profit of last month to the current loss. Naphtha, as the main process of ethylene glycol, reflects the overall status of the industry. (details of raw materials are shown in Table 1).

Six Monthly trend of major upstream prices of ethylene glycol

Source: lung Chung

Judging from the above situation, Six In June, the main driving force of ethylene glycol's strong performance came from the cost side, but the driving force was relatively limited, resulting in the trend of ethylene glycol weaker than that of the main upstream raw materials. The passive trend was very obvious. With the crude oil's re adjustment, ethylene naphtha would follow the callback, ethylene glycol would lose the cost support situation, and the influence of the market leader would be more logical than that of the ethylene glycol supply. On the one hand, the pressure on coal glycol to maintain low load continues to appear. Some factories have begun to restart or increase their negative pressure. Three Rising to the present. Four Near the beginning, there is still room for further improvement. Although the profit of oil glycol has changed from profit to loss, the start-up load is temporarily unprofitable and the profit has been affected. In terms of inventory, the inventory of the East China main port has been kept high, and the supply side is facing unprecedented pressure when the inventory turning point is difficult to take place in the later stage. The demand for the polyesters is relatively high, but it is also affected by the oil rising factor. The atmosphere has led to no apparent improvement in the rigid demand when there is no significant change in the epidemic situation. Therefore, when glycol is transferred to the supply and demand side to dominate the market, it will finish the sidewall finishing and break through the downward trend.