After a long decline, ethylene glycol finally rebounded last week. On Monday (March 13), the price of ethylene glycol rose sharply, and electronic trading closed at the daily limit in the afternoon. The market has predicted that the cyclic bottom of ethylene glycol has been formed and there is no longer the conditions for a sharp decline. However, this Monday (March 20), ethylene glycol electronic trading fell sharply again and closed at the limit again. During the month, ethylene glycol rose and fell again and again. Due to its willful performance, the market has become unpredictable. Where is the promised rebound in the market?
At present, the financial game in the ethylene glycol market is fierce. Under the confrontation between long and short, the market of ethylene glycol has skyrocketed and plummeted. Although ethylene glycol is a chemical product like PTA, the size of the ethylene glycol electronic market is completely smaller than that of PTA futures. This makes the rise and fall of the ethylene glycol electronic market easily affected by funds. Capital is in the hands of traders. If you have enough money, you can also control the rise and fall of ethylene glycol prices. But having said that, although funds have a great impact on ethylene glycol electronic trading, speculative traders also have to look at market fundamentals to make long and short decisions. So, have there been any big changes in the fundamentals of ethylene glycol recently?
1. Ethylene glycol is slowly destocking, but there is still no substantial change in supply and demand
Since the Spring Festival, the inventory of ethylene glycol port has been continuously accumulating. As of March 17, the inventory of ethylene glycol port in East China is still above 600,000 tons, although it is tens of thousands of tons compared with the inventory in early March. decline, but the current inventory still puts greater pressure on ethylene glycol. In addition to its own oversupply, continued weakness in downstream demand has dealt a blow to confidence in the entire ethylene glycol market. It is reported that March was originally the traditional peak season for downstream terminals, but since March this year, the production and sales of the polyester market have been relatively sluggish. Although the overall production in the weaving market is relatively stable and the startup load is higher than in previous years, it is difficult to stock up in the weaving market. The craze has caused headaches for upstream raw material companies. The production and sales volume of 40% to 60% has become the report card of the recent polyester market. Sales are sluggish, polyester manufacturers have high inventories, and purchasing power is naturally greatly reduced. Although downstream demand has picked up recently, the current situation of high inventory in the polyester and ethylene glycol markets has not changed. Judging from the current situation, if the inventory problem is not solved, both the chemical fiber factory and the ethylene glycol market will be like climbing a rock with heavy loads. , it is difficult to form conditions for a sharp rise.
2. The listing of ethylene glycol futures is like a dream, and the market mentality has been hit hard again
In the fourth quarter of last year, the listing of ethylene glycol futures in May 2017 caused a lot of hype. While the price of ethylene glycol soared, traders were also busy building their own inventories. For a time, ethylene glycol became a hot commodity in the market. While prices have skyrocketed, inventories have also fallen to historic lows. However, shortly after the futures listing was announced, several mainstream domestic polyester manufacturers raised objections, claiming that ethylene glycol did not have mature listing conditions and applied to the China Securities Regulatory Commission to delay the listing. After that, the ethylene glycol futures gradually faded out of everyone’s sight. Judging from the current situation, polyester manufacturers have won this game. The ethylene glycol futures are gradually moving away, causing a heavy blow to market confidence. Before the Spring Festival, the market had overly optimistic expectations for ethylene glycol. However, the sluggish market demand for polyester after the Spring Festival diluted the original benefits. The price of ethylene glycol fell back from the high level, and it was difficult to stabilize the price. At present, there is no clear positive guidance for the upstream and downstream sectors of ethylene glycol, market confidence is low, and the market outlook for ethylene glycol remains unclear.
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