For the Quarter Ending June 2021
Polyethylene Glycol (PEG) prices fluctuated in a narrow range throughout the quarter across North America region. The demand from the downstream ethoxylates derivatives and pharmaceuticals remained firm, while the overall supply activity was tight. The price of feedstock Ethylene Oxide also fluctuated in USA due to frequent change in availability within the country. However, the demand from the global market was also responsible for the overall buoyancy in the PEG prices. Improved production activities across the gulf of USA, increased the availability of upstream Ethylene in the country, which led to a decline in the prices of most of downstream products including PEG during the month of June. Therefore, under these scenarios, the price of PEG was assessed as USD 1470/MT during the last week of May in USA.
The Asian market witnessed an overall surge in prices of Polyethylene Glycol (PEG) during this quarter, backed by stable offtakes from the end user segments. PEG manufacturers based in China reported firm offtakes from the downstream units, bolstered by rapid economic recovery and rising demand from the international market. While in India, demand was comparatively low with the surge in pandemic in the country. Rising freight cost and global inflation impacted the price of Polyethylene Glycol in India, where traders were trying to protect their margins by raising their product prices. The price of PEG rebounded in India and reached USD 1719/MT and USD 2302/MT for PEG MW 200 and 1000 respectively in India during June 2021.
The European market also reported firm offtakes for PEG in its major countries, while curtailed supply activities and expensive cargoes led to an effective rise in the regional PEG pricing. During this quarter, demand for Polyethylene Glycol remined firm from the regional market, while due to limited inventory level prices kept on rising. Imported cargoes were also getting expensive in effect of soaring freight cost and lower container availability across major trade routes. In addition, low feedstock EO availability also impacted the downstream derivate PEG across the region during this quarter.
For the Quarter Ending March 2021
The North American PEG supply was disrupted in Q1 2021 due to severely low supply of feedstock Ethylene Oxide across the region. It is estimated that more than 65% of the total Ethylene Oxide plants were not running due to extreme climate calamity across the US gulf during mid-February. In addition, major upstream Ethylene plants also remained idle in effect of this climate condition. As the demand for PEG was recorded lower than expectation, shortage of feedstock chemicals remained largely responsible for small rise in its prices. In US, price for PEG rose by 1.65% in first quarter 2021 and settled down at USD 1535/MT in March.
The Asian market witnessed tight supply for PEG throughout the quarter, though the demand remained stable to firm across the region. In China, after Lunar New Year, as the inventories were running low, it pressurised the overall PEG market of APAC by supporting its prices. On the other hand, Indian market faced difficulties to procure feedstock Ethylene Oxide material due to its skyrocketing prices. Import prices from European countries like Germany were hiked every month and Suez Canal crisis supported this rising trend across the region. Meanwhile PEG prices rose from USD 2172.48 (January 2021) to USD 2255.06 (March 2021) in India.
The European market witnessed gradual increment in demand for PEG across the region amid tight availability of feedstock chemicals. US gulf storm impacted the product availability across Europe, though the production was majorly impacted by the feedstock Ethylene Oxide. Ethylene Oxide cost fluctuated with handiness of feedstock Ethylene across the region, the demand for Ethylene remained conjointly high from different sectors like PVC which rendered shortage of material across region. Overall price of Ethylene Oxide witnessed an eternal rise, and it is anticipated that it'll come back all the way down to normal as North American country production is restoring itself week over week.
For the Quarter Ending December 2020
Polyethylene Glycol (PEG) supply across the Asia Pacific region remained tight in Q4, impacted by cost pressure on manufacturers due to consistent rise in upstream values. Steep climb in the prices of Ethylene Oxide due to its limited availability supported the surge in prices of derivative PEG in Asian countries in the quarter ending December. Besides, increase in market activities of downstream sectors like skin creams, surfactant, detergent, pharmaceutical formulations, polymer etc. gradually improved the demand for the product throughout Q4 2020.
Persistent surge in the feedstock supply followed by significant rise in container freight considerably pushed up the PEG pricing in European region during Q4. Traders remained concerned of the snug upstream supply due to the low container availability across several trade routes connecting Europe. A PEG trader revealed that prices of Ethylene Oxide & its Glycol derivatives significantly increased which led to an astonishing rise in its production costs. The demand for PEG considerably improved with rise in export demand from several Asia Pacific countries which led to a positive impact upon its prices.
Demand fundamentals for Polyethylene Glycol (PEG) remained firm in North America backed by the surge in consumption of various downstream industries following the gradual pick up of economies of several countries across the region. Meanwhile, operating rates at the upstream units in the gulf region were improved after resumption in several plant turnaround due to spate of hurricanes in October. Following the strong demand for glycol ethers used in disinfectants and cleaning chemicals, prices for PEG are likely to remain in an uptrend in the next quarter as well.