For four consecutive trading days a week, ethylene glycol electronic trading hit the daily limit. After opening in night trading on Thursday (May 18), the ethylene glycol MEG1707 contract began to fluctuate and rose to the daily limit. It has been at the daily limit since the early opening on Friday (May 19), and continued to rise until the close after the midday opening.
Although the current strong rebound of ethylene glycol mainly relies on the recovery of crude oil and financial conditions, for ethylene glycol, which has fallen by 2,000 yuan per ton since the Spring Festival this year, this round of market conditions is both arrogant and domineering. Driven by the rise in electronic trading, the spot price has risen sharply for several days, jumping from below 6,000 yuan to over 6,500 yuan/ton. As of May 18, the internal price of ethylene glycol has rebounded to 6,510 yuan/ton, which is relatively high. An increase of 830 yuan/ton from last Friday.
Ethylene glycol successfully counterattacked, but PTA futures were not so confident. As of May 19, the PTA1709 contract closed at 4968 points, an increase of 150 points compared with last Friday. The spot price followed suit slightly, rising by 135 yuan/ton. . Both are polyester raw materials, why do PTA and ethylene glycol have such big differences? In addition to the boost from crude oil and funds, the fundamental role of ethylene glycol itself is also indispensable in May.
Two million tons of equipment are undergoing maintenance, and tight supply and demand support the market
Although many PTA and ethylene glycol devices have maintenance plans in May, judging from the current situation, the overall load of PTA has not dropped significantly, while the ethylene glycol maintenance season has begun, and coal-based ethylene glycol The current load is only around 40%, down nearly 10 percentage points from the beginning of the month. In terms of specific devices, it is reported that there were 8 sets of ethylene glycol devices in China in May, with a total production capacity of 2 million tons involving maintenance, and maintenance accounted for more than 20% of the total domestic production capacity. In addition to the coal-based ethylene glycol unit, Sinopec East China Company also has two units on the maintenance list. It can be said that the large-scale domestic equipment maintenance in May caused a tightening trend in the supply side of the market, supporting the rise of the ethylene glycol market.
Downstream construction is stable and demand remains strong
At present, both terminal downstream weaving and polyester manufacturers are operating at a level above 80%. The manufacturers are highly motivated and the demand for raw materials is relatively smooth. In the past week, under the stimulation of good news, the long-lost enthusiasm for stocking downstream has been aroused. The active purchasing of manufacturers has reduced the polyester yarn inventory of polyester manufacturers. At present, although polyester manufacturers still mainly purchase ethylene glycol based on rigid demand, the smooth downstream demand also plays a solid foundation for this wave of ethylene glycol market to a certain extent.
On May 19, ethylene glycol electronic overnight trading continued to close at the daily limit, and the crazy enthusiasm of the market did not seem to be affected by the weekend. Ethylene glycol experienced a sharp rise and fall last year. Is the current crazy market a rebound from a bubble or a long-term accumulation? In fact, the market is a little worried during the hype. No matter what, once the market rises, I hope it will not continue to fall like before after a sharp rise. That’s all.
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