Ethylene glycol: Asian ethylene glycol market trading dynamics

Asian MEG markets were quiet on May 9, with most trades still range-bound.

Demand is not as good as expected and overall trade remains dependent on key derived polyesters, which have seen a sharp drop in demand, especially since Shanghai began its lockdown, sources said.

The naphtha-based MEG facility was operating at about 60%, the same as the previous week. Due to some plant maintenance, coal-to-MEG production facilities in China are running at around 50% on average, down around 3%-4% from a month ago.

The surge in raw materials presents another challenge for companies, adding to their concerns about profits.

The outlook is mixed due to a wave of new MEG factories in China in 2022.

Global raw material prices are set to push up MEG prices, traders said, despite the addition of new U.S. capacity and new factories in China aimed at Asia.