Mono-Ethylene Glycol Market Slumps, and the Outlook Remains on A Bearish Note
- 18-Aug-2022 2:42 PM
- Journalist: Nina Jiang
Wuhu, China: The Mono-Ethylene Glycol (MEG) market entering August has been noticing a downward trajectory in the Chinese market. The Polyester filament’s weak production and sales forced manufacturers to reduce their profit margins. Meanwhile, demand-supply fundamentals improved while having irregular destocking frequency. Thus, as per ChemAnalyts, the price for Mono-Ethylene Glycol in China has reduced by 2% on 18th August 2022.
Ongoing with the reduced demand, a Canada-based Mono-Ethylene Glycol plant with a production capacity of 400,000 tons/year has been shut recently. In addition, Mono-Ethylene Glycol units with 800,000ton/year have dropped their production by 2% to 30%, and the plan may last till the end of September. It is anticipated that the demand from the textile sector for Polyester may improve in the coming months, but for now, the market is still hesitant over consumers’ purchases.
According to the market sources, the availability of the product has reportedly outpaced demand, which has caused an overabundance of materials on the market. Traders are also on the verge of destocking its availability, but the scenario from the downstream Polyester sectors seems to continue sluggishly.
Following the Chinese market trend, Indian manufacturer Reliance Industries Limited (RIL) reduced the prices for Mono-Ethylene Glycol in the Indian market. The demand in the weaving and garment industry has been lowering, and the outlook for the future remains on a backward trend. Meanwhile, abundant availability is the major problem in the Asian market, slumping Mono-Ethylene Glycol prices.
In addition, Recently, a new Mono-Ethylene Glycol facility in Zhejiang with an annual capacity of 800,000 tonnes was placed into trial operation. It is anticipated that the product will be released shortly.
According to the ChemAnalyst database, “The price for Mono-Ethylene Glycol may continue to remain on the weaker side, as demand fundamentals seem blur alongside sufficient inventories.”