For the Quarter Ending March 2024
North America:
During the initial quarter of 2024, the North American Diethylene Glycol (DEG) market faced challenges that drove prices upwards. A bullish market prevailed due to limited supply caused by the closure of several production plants amid severe cold weather. High demand in the antifreeze sector, driven by freezing temperatures, further fueled price increases. Fluctuations in raw material costs and a strong demand for automobile antifreeze also impacted the market.
Similar factors affected the United States market, where significant price changes occurred. Prices remained stable during the first two months, supported by existing inventory levels meeting downstream demand. However, the final month of the quarter witnessed a surge in prices due to constrained supply exacerbated by disruptions in freight, particularly from the Red Sea incident. Price adjustments by key players, including Indorama Venture, also influenced market trends.
In summary, the DEG market in North America, particularly in the United States, saw price increases during the first quarter of 2024. Factors such as heightened demand from downstream industries, fluctuating raw material costs, and increased freight charges were key drivers. In the US, DEG prices rose by over 14% compared to the same quarter the previous year and by more than 13% compared to the preceding quarter of 2023.
APAC:
The Diethylene Glycol (DEG) market in the APAC region witnessed steady demand during the first quarter of 2024. The market showed signs of recovery after a decline in the previous quarter, as downstream industries began to increase their demand. Although there were some concerns regarding high stock inventories, the market managed to maintain a moderate level of demand. Crude oil prices remained volatile, impacting the prices of DEG and its derivatives. South Korea, one of the key players in the market, experienced stable supply levels, ensuring uninterrupted production activities. However, the product's price was slightly affected by logistics freight charges, resulting in a minor decrease in the latter half of the quarter. Despite this, sellers were able to maintain their profit margins due to the limited availability of materials in the region. The top three factors that influenced the market during the quarter were the recovery in demand from downstream industries, fluctuating crude oil prices, and limited material availability. Fortunately, no plant shutdowns were reported during this period. In terms of trend and seasonality, DEG prices in South Korea remained inclining, with 8% increase compared to the same quarter last year. However, prices showed a slight increase of 12% compared to the previous quarter of 2023.
Europe:
In the initial quarter of 2024, the European Diethylene Glycol (DEG) market saw several factors influencing price dynamics. Plant closures led to limited supply, tightening availability, and pushing prices upwards. Multiple shutdowns across the region exacerbated these constraints. Additionally, ongoing geopolitical tensions in the Red Sea area disrupted global trade routes, driving up freight costs and further impacting DEG prices. In Germany, a key player in the European market, DEG trends were bullish. Increased demand from sectors like polyester and polyurethane collided with challenges stemming from transportation disruptions caused by strikes and adverse weather conditions. These disruptions, coupled with plant closures, contributed to rising freight charges and logistical complexities, further impacting DEG prices in the country. Conclusively, the first quarter's price of DEG CFR Hamburg in Germany stands at USD 1150/MT, marking a significant increase compared to the same period the previous year and signaling positive price momentum. To sum up, during the first quarter of 2024, the DEG market in Europe faced supply limitations, transportation disruptions (including strikes and adverse weather conditions), and fluctuations in feedstock prices. Germany, specifically, felt the effects of these factors, influencing the pricing dynamics of DEG in the region.
MEA:
During the initial quarter of 2024, Diethylene Glycol (DEG) prices in the Saudi Arabian market displayed a mixed trend. This shift in dynamics was driven by tight supply resulting from production unit closures and heightened freight costs, exacerbated by the Red Sea crisis and overseas market demand. Initially, the key player in DEG production, the Eastern Petrochemical Company (SHARQ) units No.1 and No.2 in Al-Jubail, played a crucial role in price increases and disruption of supply-demand dynamics. Concurrently, marine logistics disruptions also contributed to price hikes and supply-demand disturbances, particularly as Saudi Arabia, a major global producer, primarily supplies Asian markets. Fluctuations in global crude oil prices further compelled Saudi Arabia to raise prices for its derivatives, increasing production costs. In the latter half of the quarter, the market remained bearish following the inventory recovery, resulting in ample inventory levels and smooth supply. In summary, the DEG market in the Middle East and Africa (MEA) region encountered challenges of limited supply, fluctuating demand, and plant shutdowns during the first quarter of 2024. These factors continued to impact prices, with noticeable changes observed in Saudi Arabia, where DEG prices increased by over 5% compared to the previous quarter.
For the Quarter Ending December 2023
North America
In the fourth quarter of 2023, the Diethylene Glycol (DEG) market in North America experienced a mix of challenges and opportunities.
The market was primarily affected by disruptions in both supply and demand, leading to fluctuating prices. First, the overall supply of DEG in the region remained low to moderate, with concerns about sluggish growth in production due to a decrease in new orders and subdued export markets. On the demand side, there was moderate to high demand from various industries, including the antifreeze sector, which showed signs of a gradual recovery. However, there was sluggish demand from the downstream polyester resin and plastic sectors. Additionally, the market experienced fluctuations in feedstock prices, which had a cascading effect on DEG prices.
In the USA, the largest market in the region, DEG prices saw a slight increase in October and November, followed by a decrease in December. The price change from the previous quarter was +2.0% in October, +2.3% in November, and -1.8% in December. Overall, the DEG market in North America experienced a dynamic quarter with various factors influencing prices. The latest price of DEG CFR Texas in the USA for the current quarter is USD 765/MT.
APAC
The Diethylene Glycol (DEG) market in the APAC region during Q4 2023 witnessed a mix trend due to firm demand from the domestic market, especially in South Korea, where the FOB Busan price of DEG was recorded at USD 656/MT. The supply of DEG remained low due to reduced availability of products in the global market, heightened feedstock prices, and surplus material availability, leading to a narrowed gap between demand and supply. The downstream industries such as polyurethanes and antifreeze sectors maintained a high demand for the product, while reduced demand from the downstream antifreeze sector remained a primary reason for the decrease in DEG prices. Furthermore, the market achieved a balance due to consistent feedstock supply and uninterrupted production. No plant shutdowns were reported during the quarter. In comparison to the same quarter last year, the price of DEG remained stable with no changes. However, the price of DEG in South Korea increased by 10% in the current quarter compared to the previous one. The price comparison between the first and second half of the quarter showed a decline of 2%. Overall, the bullish trend in the DEG market in the APAC region during Q4 2023 was driven by firm demand, reduced supply, and consistent production.
Europe
In the fourth quarter of 2023, the Diethylene Glycol (DEG) market in Europe experienced a challenging period with several factors impacting prices and market dynamics. Firstly, there was a decrease in demand from the downstream polyester resin and plastic sectors, which exerted downward pressure on DEG prices. This decline in demand was attributed to the weakening fundamentals in these industries and customer uncertainty. Additionally, the antifreeze industries showed signs of a gradual recovery, but the extent of this recovery remained uncertain. Another significant factor was the oversupply condition in the region, as European producers limited supply to align with subdued demand and prevent excess inventories. This oversupply situation led to a competitive market where suppliers resorted to selling inventories at discounted prices. Furthermore, the German market, in particular, experienced a decline in demand due to persistent inflationary pressures, weak microeconomic activities, and a decrease in the Consumer Price Index. Despite these challenges, the quarter ended with a price of USD 875/MT of Diethylene Glycol CFR Hamburg in Germany. This price represents a -10% decrease from the previous quarter and a -30% decrease compared to the same quarter of the previous year.
MEA
In the current quarter of 2023 (Q4), the Diethylene Glycol (DEG) market in the Middle East and Africa region faced several challenges. Firstly, there was a significant decrease in prices, with a percentage change of -4% compared to the previous quarter. This decline can be attributed to weak demand from downstream industries such as polyester resin and plasticizers, as well as the overall economic situation in the region. Additionally, the market experienced a decrease in demand from the antifreeze sector, further contributing to the downward pressure on prices. In Saudi Arabia, the largest producer in the region, the DEG market was particularly affected. The country saw a decline in prices, with a percentage change of -6% compared to the same quarter of the previous year. This can be attributed to the sluggish demand from the polyester resin industry and the cautious outlook of the antifreeze sector. Additionally, the availability of excess inventory in the market and the impact of rising production costs due to higher raw material prices further contributed to the price decline. There were no reported plant shutdowns during this quarter. The latest price of Diethylene Glycol FOB Jeddah in Saudi Arabia for the current quarter is USD 615/MT.
For the Quarter Ending September 2023
North America
The price for Diethylene Glycol fluctuated throughout the third quarter of 2023, owing to the reduced consumption from downstream industries. During the first half of the quarter, there was lackluster demand for polyester resin as well as plasticizer, thereby weakening the market activity of Diethylene Glycol. However, in the second half of the quarter, the market for Diethylene Glycol gained momentum, following the announcement by the U.S. Bureau of Labor Statistics indicating a 3.7% annual increase in the Consumer Price Index in August 2023, several industries, including the Diethylene Glycol (DEG) sector, had felt the impact of rising expenses. The significant increase in production costs in the DEG industry was due to the challenges faced during the production process, with crude oil prices surging during the month. Additionally, there were uncertainties related to weather disruptions, with Hurricane Idalia being a notable event during the hurricane season. Consequently, due to reduced production activities, a resulting shortage of DEG emerged, affecting both domestic and international markets. This shortage had played a crucial role in influencing the broader market trends.
APAC
During the initial half of the quarter, the diethylene glycol (DEG) market witnessed a decline, primarily driven by subdued downstream market activity. However, as the second month of the quarter commenced, a notable shift occurred, with prices steadily rising from that point onwards. This shift was largely a result of increasing demand from downstream industries, further exacerbated by a shortage of material. This heightened demand, in turn, contributed to the upward trajectory of Diethylene glycol prices. Additionally, the DEG industry grappled with a significant increase in production costs, largely attributable to the surging crude oil prices during this period. Nevertheless, the DEG market encountered supply-related challenges due to typhoons in the Korean peninsula in the latter half of the quarter. These challenges were exacerbated by low inventory levels and reduced supply, resulting in a fluctuating trend in the Asia-Pacific region. On a positive note, South Korea reported an increase in the Consumer Price Index (CPI), with the index rising to 112.33 points in August from 111.20 points in July 2023, as reported by Statistics Korea.
Europe
During the third quarter of 2023, the diethylene glycol (DEG) market underwent price fluctuations. These fluctuations began with a decline in the first half of the quarter, primarily due to a bearish market sentiment. Demand from downstream industries was largely lackluster during this period. Additionally, the availability of affordable imports from the Asian market contributed to an ample supply of materials in European ports. However, as the quarter progressed, there was a reversal in this trend, leading to an increase in DEG prices. This price upswing was primarily fueled by a surge in demand, which played a pivotal role in driving the higher prices. Furthermore, the rising prices of Naphtha, a critical raw material in DEG production, added support to the price increase. Despite having a sufficient supply of materials, the DEG market faced challenges related to weather disruptions. Heatwaves and heavy rainfall in Germany caused fluctuations in the water level of the Rhine River, a crucial waterway for transportation and trade in Europe. These variations in the river's water level directly affected the import of diethylene glycol from other Asian markets, leading to the price hike at the end of the Q3.
For the Quarter Ending June 2023
North America
During the start of Q2, Di-Ethylene Glycol prices rose steadily in the US market. The increased demand dynamics and low inventory levels in the relevant market were the main contributors to the unanticipated price increase. However, instability in the crude oil market as a result of the global economy, worries about the US banking system, and the Fed raising interest rates have had a significant impact on the pricing for DEG. Towards the second half of the quarter, the Di-Ethylene Glycol (DEG) market faced several challenges that narrowed profit margins in the USA. One significant factor was the decline in US natural gas prices. The decline in natural gas prices in the US impacted the DEG market. On the demand side, downstream demand for Polyester resin was weak as consumers sought to economize amid the recession fear. Furthermore, the US manufacturing sector contracted in May, with the Manufacturing Purchasing Managers' Index (PMI) registering a decrease from April. Finally, the price for DEG settled at USD 780/MT CFR Texas during June 2023
APAC
South Korean Diethylene Glycol (DEG) market recovered during the first half of Q2. The main factor influencing prices was the reduction in inventories and the volatile crude oil market. In addition, the cut in crude oil production by the OPEC+ members from May until the end of the year had increased the prices of the main crude oil derivative products during this period. Later in the second half of Q2, due to the weak demand and excess availability of the material, Di-Ethylene Glycol (DEG) prices dropped significantly by 6%. The increase in stockpiles, coupled with a slowdown in downstream procurement from the polyester resin and plasticizer industries, further depressed the buying enthusiasm. In addition, analysts reported that supply chains in the region had improved, and production costs had also weakened due to the drop in the price of the feedstocks Ethylene and Crude Oil. As a result, the DEG market in the Korean market slowed down, with prices hovering at USD 627/MT FOB Busan during June 2023.
Saudi
Di-Ethylene Glycol prices increased steadily in the Saudi market during the start of Q2. The main causes of the unexpected price hike were the market's low inventory levels and rising demand dynamics. The global economy's impact on the crude oil market, concerns about the US banking sector, and the Fed's decision to raise interest rates have all had a big impact on DEG pricing. Later, the decrease in crude oil prices contributed to this decline by impacting the market for Ethylene, a key feedstock for DEG production. Moreover, trade momentum in the DEG market slowed down with limited buying interest. However, on the supply side, manufacturers reported enhanced supply chain performance and smooth operation of DEG units, which brought some positive news. Currently, the region has sufficient production, leading to a gradual build-up of inventories. As a result, the final price for DEG during the end of June 2023 was found to be USD 680/MT FOB Jeddah.
Europe
Di-Ethylene Glycol prices have gained upward momentum across the global markets during the start of Q2. The primary factor for the unexpected price rise was the improved demand dynamics and limited inventory levels in the respective market. However, the global economy fears about the US banking system and the Fed hiking interest rates have led to uncertainty in the Crude Oil market, which had a great impact on the pricing for DEG. Meanwhile, demand from downstream polyester resin and plasticizer industries has increased substantially owing to improved buying sentiments in the region. During the second half of Q2, the European market for Di-Ethylene Glycol (DEG) was facing challenges as a result of low demand and an excess supply of the material. Experts in the industry attribute this decline to surplus stocks, indicating a saturated demand in the market. The current macroeconomic conditions are evident in the recent decrease in feedstock prices for Ethylene, which indicates a reduction in production costs. As a result, the price for DEG showcased mixed sentiments during the second quarter of 2023, with prices hovering at USD 1040/MT CFR Hamburg during June 2023.
For the Quarter Ending March 2023
North America
Diethylene Glycol prices increased in March compared to the prior month. The price of feedstock Ethylene rose, which added to the rising cost of production. Additionally, the incline in DEG costs was caused by both a rise in polyester operating rate and an excessive demand from downstream polyurethanes industries. However, Saudi Arabia's supply remained comparatively consistent throughout the month, and the maintenance and shutdown of the MEG plant had a greater impact on it. As a result, the DEG market in the USA was impacted by changes in the supply of Saudi cargo. Meantime, the downstream demand grew, and the overall market sentiment was optimistic. As a result, the market was upbeat owing to the robust demand side, and the market environment was generally favorable.
APAC
The domestic Diethylene Glycol (DEG) industry increased from the prior trading day. The shipping situation got better, but the limited supply of products contributed to the upward price trend. The price for DEG gained momentum owing to falling inventories and low unit output amidst some maintenance of MEG plants. The supply side was good, plus the downstream demand grew, and the overall market sentiment was optimistic. The supply of raw material ethylene oxide remained tight due to the high demand from the other downstream industries. However, the market was upbeat owing to the robust supply and demand side, and the market environment was generally favorable. As a result, the market for DEG rose throughout Q1, with prices hovering at USD 868/MT Ex-Guangdong during March.
Europe
Diethylene Glycol (DEG) market recovered during the first quarter of 2023 as inventories in the region reduced. However, supply chain disruptions had eased, reducing the delivery time. The primary factor which affected the pricing was reduced inventories and the volatile crude oil market. The Diethylene Glycol market was also supported by declining inventories. Materials were scarce because manufacturers were still waiting for price negotiations for their feedstock, Ethylene. However, the material supply had been hampered by the German strike. As a result, the market for diethylene glycol increased throughout the first quarter, with March prices circling USD 1295/MT CFR Hamburg.
For the Quarter Ending December 2022
North America
Diethylene Glycol (DEG) prices primarily observed an increase in the middle of the quarter as they fluctuated throughout North America in the fourth quarter of 2022. However, the majority of it experienced a downturn in the market because the demand from the polyester and downstream plasticizer industries was insufficient to offset the price increase. There were several additional factors, including delays in cargo imports and exports brought on by port closures and restricted port operation hours in the USA. Hurricane Ian, which prolonged shipping delays and had ships dock at ports on the East and Gulf Coasts while the West Coast battled supply-chain issues, labor disagreements, and a lack of storage capacity, made the need to begin port activity even more urgent. Due to this, the price fluctuated in the fourth quarter and settled at USD 795/MT CFR Texas during November 2022.
APAC
The Diethylene Glycol (DEG) prices in South China primarily increased throughout the fourth quarter of 2022. Because of the strong market sentiment and firm offers, downstream demand improved. In October, the combined DEG offtake at Vopak and Changjiang International Ports was 1550Mt. Participants were largely on the sidelines, which reduced trading activity. Both the local market and imports were generating more new orders for the downstream industry. Few imported ships arrived, and the inventory kept going down in a specific range. Low levels of inventory provided the market with solid support and reduced supply pressure. However, as a result of the ongoing effects of the covid restrictions in China, several regions' logistics and transportation were obstructed, and downstream inventories remained low. In conclusion, the price for DEG increased and settled at USD 712/MT CFR Qingdao.
Europe
In the fourth quarter of 2022, Diethylene Glycol (DEG) prices varied in Europe. Due to a constrained supply of the material in the region and an anticipated rise in local demand, the price of the item increased. Market participants asserted that producers were preparing to run their output at high rates when demand rose and low stock amongst the manufacturers. Later, due to the high demand for diethylene glycol from the plastics industry, manufacturers advise substantial offtakes on the demand side. Later, a rise in company confidence was backed by easing inflationary pressures and bettering economic conditions. However, the Polyester resin industry and downstream plasticizer sectors' weak fundamental demand drove down the prices for DEG. As a result, the price for DEG fluctuated and settled at USD 1290/MT CFR Hamburg during November 2022.
For the Quarter Ending September 2022
North America
As a result of the worldwide crisis, including fluctuating crude oil prices, rising inflation, and the US-China trade war, Diethylene Glycol prices rose in the North American market during the first part of Q3. The market for its feedstock, Ethylene Oxide, has also witnessed mixed trends due to the uncertain trend of global crude oil. While rising interest rates, tight supply, and high inflation have put pressure on product prices, the export market has remained robust from downstream polyester resins, polyurethanes, and plasticizers. Later in the second half of Q3, Hurricane Ian intensified cargo delays, forcing ships to divert to East and Gulf Coast entry sites as the West Coast struggled with supply-chain problems, labor disputes, and warehouse space shortages.
APAC
Diethylene Glycol prices in China increased by 3.2%, supported by the rising inflation and Covid restrictions in the Chinese market, which aided in the upward rally in Diethylene Glycol prices in the first half of Q3. Meanwhile, the oil market faces tight supply amid lowering OPEC output as OPEC struggles to meet its oil output, as agreed earlier in the first half of Q3. In contrast, the second half of Q3 witnessed abundant regional product availability and decreasing demand outlook in the domestic market, leading to a decrease in price. According to market sources, producers were also on the verge of reducing their production rate as demand lowered and products overflowed in the domestic market.
Europe
Germany's Diethylene Glycol (DEG) price increased by 5% in the first half of Q3. Due to a constrained product supply in the region and an anticipated rise in local demand, the product price increased. However, demand rose from the plastics industry, which accounts for 25% of worldwide consumption. In addition, due to the lowering of Rhine's water level, shipping issues rose, and the faltering economy were all factors that contributed to the market's negative sentiment in the second half of Q3. Thus, the commodities' supply was also hampered due to the congestion at the German ports of Bremerhaven and Hamburg.
For the Quarter Ending June 2022
North America
Diethylene Glycol (DEG) prices remained stable to decline in the North American region during the second quarter of 2022. Feedstock ethylene glycols, glycol ethers, and polyols markets observed unprecedented volatility, backed by the firm crude oil market price. Thus, owing to the uncertain market, the demand for the product slumped, as many manufacturers were waiting for a further drop in DEG prices. Meanwhile, market participant of the downstream industries using DEG in antifreeze, brake fluids, cosmetics, and lubricants reduced their offtakes during the considered quarter. At the same time, demand from Paints and Coatings, Adhesives, and Plastic industries remained firm during the first half to make prices roll over as previous month.
APAC
Diethylene glycol prices in China have constantly decreased in the second quarter of 2022. Inflationary pressure over Diethylene glycol has eased in the last couple of months, stemming from declining demand. Sluggish Diethylene Glycol demand from downstream polyester and plastic industry has reduced consumption. The feedstock ethylene oxide market has also weakened in the last few months, resulting in declined cost pressure over downstream DEG. This has further weakened the market sentiment and resulted in worsening pricing fundamentals. Thus, the price for DEG in China fell and settled at USD 858/MT CFR Texas. In contrast, the price for DEG in India increased in the first half, which later dipped by 4%, owing to sufficient availability and lull demand for the product in the regional market.
Europe
In the second quarter of 2022, Diethylene Glycol (DEG) prices in European countries declined in the regional market, which later caught pace owing to its rising demand from downstream industries. Markets for ethylene glycol, glycol ether, and polyol feedstocks experienced exceptional volatility, supported by the firm price of crude oil. Prices rose in the second half of this quarter due to solid downstream demand from the polyester and plastic industries. In the meantime, as an unpredictable Crude oil market dominated its feedstock ethylene oxide market, the price trend was also influenced by the crude oil market. Inline, crunch supply alongside soaring freight charges led to higher prices in later months.
For the Quarter Ending March 2022
North America
Diethylene Glycol market trend remained stagnant due to uncertain demand fundamentals from the downstream industry. Market of feedstock Ethylene reacts in response to the fluctuating crude oil prices in the international market. Low demand from the polyester and plastic sectors caught market participants anxious in the first quarter, resulting in dull prices of DEG. DEG prices is North America were assessed at USD 857/MT CFR Texas in February 2022. In addition, supply chain disruptions, rising energy prices, and the war between Russia and Ukraine pressurized the commodity's price, as export and import of the product in the regional market were disrupted, which resulted in weaker market sentiments.
Asia Pacific
In Asia, prices of feedstock Ethylene Oxide, rose in the first half of Q1 as energy prices rose but then fell due to improved availability of the product. In China, slight withdrawal from the downstream polyester industry caused prices to fall in the first half of the first quarter, but the market gained momentum in late Q1 as the demand gradually improved from end-users. Further, the offers for ethylene oxide increased with increased cost support from upstream crude oil, along with the geopolitical turmoil in Eastern Europe, which led to crude oil prices exceeding USD 113 per barrel. Therefore, DEG cost tumbled in February and settled at USD 787 CFR Qingdao.
Europe
In Europe, DEG market witnessed dullness in the first half of Q1, which later improved and rose by 5% in the second half of the quarter. Raw material Ethylene Oxide rose with low availability of material amidst prevalent demand to manufacture Diethylene Glycol. Demand from the downstream polyester industry turned sluggish in the first half on the back of Russia's war against Ukraine. In contrast, volatile crude oil value affected the production of the product as the raw material gained a hike, adhering cost pressure upon downstream producers. Therefore, prices for DEG in the domestic market rose in late Q1 and settled at USD 782 CFR Hamburg in March.
For the Quarter Ending December 2021
North America
Availability of feedstock ethylene oxide improved throughout the quarter owing to increased supply of upstream ethylene after sluggish Q3. Ethylene oxide prices remained strong in Q4 although prices stabilized towards the later stages of Q4 in the wake of winter holiday season. Diethylene Glycol market witnessed increased buying interest as demand from downstream users gained momentum in Q4. Imports of Diethylene glycol also remained limited owing to strong freight charges on Middle East Asia-US trade routes and long transit time. Thus, sluggish domestic production and hampered imports resulted in snug DEG supply and consequently prices were assessed on an incessant uptrend during the last quarter. DEG prices were assessed at USD 1870 per MT in December.
APAC
Diethylene Glycol prices kept on climbing up in October, supported by firm offtakes from the domestic consumers. Rising raw material cost also supported this upward price trajectory for the product, as demand for raw material ethylene faced competition from polymers. In addition, demand for DEG remained significantly firm from downstream sectors, bolstered by festive optimism. Thus, DEG price rose significantly and settled around INR 79100/MT Ex-Mumbai in October. Ethylene Oxide prices after reaching significant highs in early November, came down towards December end due to the slowdown in downstream demand. In line with the narrowed demand and supply gap, downstream Diethylene Glycol prices in India were assessed down by nearly 10% in the initial weeks of December. In China, feedstock ethylene oxide prices dropped consistently throughout Q4 which consequently decreased cost pressure over downstream Diethylene Glycol. Inventory levels remained strong amid stagnant demand and stable operating rates which kept downward pressure on the available material. Diethylene Glycol prices in China were assessed at USD 830 per MT.
Europe
Feedstock ethylene oxide remained on a bullish rally throughout the last quarter however the pace of price increment slowed down in second half owing to improved production and stable demand. Consequently, cost pressure was firm over downstream Diethylene glycol in Q4. Demand of DEG was termed as firm stemming from increased offtakes from downstream industries. This in turn presented market participants with opportunity to increase their margins. At one instance during the quarter, prices of Diethylene glycol crossed USD 2000 per MT mark on FD basis consolidating on firm demand and weakened supply fundamentals. Imports from Middle East Asia also remained curtailed owing to strong freight charges and shipping costs
For the Quarter Ending September 2021
North America
The domestic market strengthened across the North American region in the third quarter of 2021 and supplies for raw materials improved during the quarter due to better plant run rates after supplies remained impacted due to hurricane Ida. After increased refinery utilization in the US, an increment was observed in the supply of upstream feedstock including ethylene oxide which is used for the commercial production of Diethylene Glycol (DEG). Demand for Diethylene Glycol from the downstream sectors such as polyester resins, plasticizers, humectants, and others increased during the quarter.
Asia
The overall market outlook of Diethylene Glycol (DEG) showcased mixed sentiments across the Asia Pacific region during Q3 2021. In the Indian market, the supply of ethylene oxide for Diethylene Glycol production was increased while the supply of Diethylene Glycol remained stagnant during the quarter. Soaring freight charges and tight availability of the material led to price fluctuations in the country. The price of Diethylene Glycol last stood at USD 929 per MT Ex-Hazira in September. The demand for Diethylene Glycol remained strong from the downstream plasticizers and humectants in Q3.
Europe
In the European region, the prices of Diethylene Glycol (DEG) witnessed a significant rise during the third quarter of 2021. Demand was under pressure in the first half of the quarter due to low consumption from the downstream industries. Soaring energy rates and high prices of EO further impacted the pricing trend of Diethylene Glycol across the region in Q3. A gradual increment in the prices of DEG was observed in August and September due to high energy rates.
For the Quarter Ending June 2021
North America
DEG supplies in the North American region improved compared to the previous quarter, as the restoration of the industrial infrastructure in the Gulf Coast meant better availability of the feedstock, as the several producers ramped up the production rates of Diethylene Glycol in the USA. Major manufacturers such as Dow increased the run rates post the impact of winter storm Uri. However, continuous variations in the prices of upstream Ethylene on back of lacklustre demand from the downstream market maintains a stagnation in the prices of Diethylene Glycol in the second quarter. Demand outlook remained severely hampered as the offtakes from the antifreeze industries plunged amidst the offseason, however enquiries were consistent from the manufacturers of Polyurethanes, Polyether Resins, and plasticizers industries.
Asia Pacific
The overall market outlook of Diethylene Glycol (DEG) varied across different countries in the Asia Pacific region. At the starting of the quarter the demand outlook was curtailed by significant margins in the Southeast Asian region as the second COVID wave restricted the commercial and industrial activities in India, whereas there remain supply uncertainties as activity in the key trading port in Guangdong province due to rising COVID cases. Due to overall demand dullness, the overall pricing trend in India remained on a down stride throughout the second quarter with Ex-Depot Mumbai discussions settling at USD 945 per tonne in June.
Europe
Diethylene Glycol (DEG) supplies in the European region improved in the second quarter of 2021, owing to the recovery in the industrial operational rates post winter season and the restoration in the raw material supplies which restored due to better import volumes from the USA. Inquiries were piled up from the downstream polyurethanes, polyether resins, and plasticizers industry. As a ripple effect of improved supply outlook, the prices of DEG in the European market stabilized in the second quarter of 2021.
For the Quarter Ending March 2021
North America
During the first quarter of 2021, DEG supplies were hindered as the region witnessed a downfall of 68% in upstream Ethylene production amid the rigorous freeze weather conditions in USA gulf region which forced to the regional plants to shut down. Arbitrage with the Asia improved as the domestic buyers becoming more flexible towards the Asian supplies. The demand surged from the downstream sector due to better offtakes from the various industrial segments including unsaturated polyester resin (UPR) sector.
Asia-Pacific (APAC)
Supplies of Diethyl Glycol remained tight for a larger part of the first quarter, as most of the upstream ethylene was diverted towards the PET manufacturing, followed by several plant turnarounds amid the Chinese lunar new year holidays in mid-February. The demand in China was seen recovering slowly after curtailed downstream unsaturated polyester resin (UPR) rates reported by some downstream convertors. Slackening demand prompted CFR China DEG rates to nose-dive to USD 500 per tonne in mid-February.
Europe
DEG supplies in the European region were sluggish during the Q1 2021, as the several refineries were operating at low production capacity amid the cold weather in Northwest European region, followed by the transport disruption in Amsterdam-Rotterdam-Antwerp route due to high water levels. Lack of supplies from USA triggered additional fears amidst importers. DEG demand in the region was stable due to the limited offtakes from the downstream sectors.
For the Quarter Ending September 2020
North America
With low estimated polyester growth in North America, DEG demand growth is unlikely to keep pace with increase in supply throughout 2020. Reduction in exports due to transportation constraints has created a supply glut in the domestic market which further resulted in downward pressure in the prices of DEG in the region. Diminished demand from the downstream market, has rendered major US DEG players maintain a cautious approach over curtailed margins, thereby increasing inventories and forcing producers to induce reduction in the plant operating rates.
Asia
Dampened demand from the Polyester industry has created an oversupply of Diethylene glycol across Asia. Lack of volume offtakes have triggered a sharp slump in the pricing curve of Diethylene Glycol in the first half of 2020. Several new MEG plant set-ups planned in the Asian countries such as China and Malaysia are delayed till 2021 attributed to pandemic-induced challenges. However, with the revival in market fundamentals, prices of DEG have witnessed a progressive gain in the third quarter. Sentiments seemed bolstered with China estimated to add another downstream polyester capacity of more than 1 million tonnes and curtail its import dependence from US due to the ongoing trade war. which could result in further increase in price of DEG.
Europe
Following Hurricane Laura in August, around one third of production in the US was slashed down, leading to tighter product availability in Europe. Demand from the downstream industries turned better with rising enquiries from the unsaturated polyester resin manufacturers compared to the offtakes for antifreeze or coolant as the pandemic seems to take a greater toll over the downstream automobile industry.
