The price of ethylene oxide fell during the month, falling by 200 yuan from 7,550 yuan/ton at the beginning of the month to 6,550 yuan/ton today, a drop of 2.65%.
From the perspective of cost, the demand for ethylene is weak in the short term. Last month, the total sales of PE in the United States fell by 7.3% compared with May. PE inventories rose by more than 100 million pounds in June, and U.S. ethylene inventories hit a record high in the first quarter, according to AFPM. Petrochemical producers in the Asia-Pacific region will implement a new round of production cuts at their crackers and downstream polymer plants starting in August and September due to weak profits and sluggish demand. Naphtha-ethylene prices continued to fall below the break-even line, and ethylene profit margins were squeezed. The price of ethylene in Northeast Asia fell first and then rose, with little difference between the beginning of the month and the end of the month. Currently, the latest price of ethylene in Northeast Asia is $910/ton. Based on the current price, the theoretical loss of ethylene oxide is expected to be around 500 yuan/ton.
From the perspective of demand, the center of gravity of the monomer market fell during the month, and the holders frequently offered low prices, and the real orders continued to decline. Terminal purchases are mainly based on rigid needs, and the transaction situation is not optimistic.
From the perspective of supply, due to the impact of profit margins, some manufacturers lowered their start-up load during the month, and the supply volume has been reduced. However, due to weak demand, the supply side is still relatively wide. At present, 100,000 tons of Sanjiang have been parked, Sailpan’s load has dropped to 80%, and Far Eastern United, Shanghai Petrochemical, Yangzi Petrochemical, and Tianjin Petrochemical are parking.
Supply and demand are at a stalemate, but from the perspective of historical trends, the current ethylene oxide is close to the period of bottoming out and rising. There are already rumors in the market that the price of ethylene oxide will rise, so we need to pay close attention to the latest factory news.
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