In May, The Ratio Fell By 6.6%. Can Ethylene Glycol Rebound In June?

In May, the market trend of ethylene glycol was the main trend, with a slight stabilization at the end of the month. As at the end of the month, the spot market in the East China market talked about 4350 yuan / ton, the average price of the market was 4353 yuan / ton in that month, and the ratio fell 6.60%.

At present, domestic supply side has been reduced, the contradiction between supply and demand has eased, but polyester production and marketing remain sluggish, and the storage is expected to be stronger. The ethylene glycol market or stalemate consolidation is expected to be the main market in June.

Upstream and downstream risks increase

Oil prices fell slightly this week. As of Friday, the price of WTI fell by 2.04 US dollars / barrel compared with last Friday, and the oil volume has been lowered by 1.82 US dollars / barrel.

Although production cuts and tensions in the Middle East still support oil prices, the complexity of the trade situation still limits the upward trend of oil prices.

And the trade war looks likely to last for a long time, which severely depressed the risk sentiment and dragged down the risk assets such as crude oil, even though the supply decline still brought good results.

The United States has opened the peak of summer oil consumption, but last week the US crude oil output fell by less than expected. Meanwhile, the unexpected increase in gasoline inventories has frustrated the long confidence of crude oil, and combined with the negative impact of the trade situation on the demand for crude oil, the downside risk of oil prices has increased.

Port inventory tends to ease

By the end of May 30th, the port of ethylene glycol in East China's main port area had a stock of about 1 million 163 thousand tons, an increase compared with the middle and late 5 months.

Among them, 86.8 tons in Zhangjiagang, an increase of 10 thousand tons per annulus, a daily average delivery of some 8600 tons of a mainstream warehouse, 62 thousand tons of Ningbo, a reduction of 25 thousand tons per annulus, 83 thousand tons of Shanghai and Changshu, a reduction of 8 thousand tons per annulus, 122 thousand tons of Taicang, an increase of 29 thousand tons per annulus, and an average daily shipment of about 3900 tons in the mainstream reservoir area; 28 thousand tons in Jiangyin, an increase of 29 thousand tons in the ring.

Downstream demand steady and weak

Entering the June, the downstream polyester terminal began to enter the off-season, the device maintenance continued, the overall construction fell to 86.26%.

For a short period of time, both the maintenance and restart are stable.

On the other hand, the early stage of high polyester stocks in the terminal Loom factory replenishment to promote polyester factory production and sales significantly improved, there has been a marked decline.

According to specific inventory data, the total stock of polyester market to 14-22 days, of which POY inventory is concentrated in 6-11 days, FDY inventory to 13-18 days, and DTY stock to 21-27 days.

To sum up: in June, ethylene glycol slowed down in port storage, and the space of the polyester terminal continued to decline, and the market rigidity demand remained relatively stable. Under the contract reduction, the intention of rigid replenishment is expected to increase. Ethylene glycol fundamentals are expected to usher in a favorable stage. The probability of ethylene glycol oscillation rebound is expected to be larger. However, under the expectation of the overall supply of the medium and long term, the properties of the short end configuration of ethylene glycol are unchanged, and the rebound is highly restricted.

(source: Zhuo Chuang information, Guo Ye net, Huaxi Village commodity contract trading center)