Asian ethylene glycol market trading dynamics

Asian ethylene glycol import prices were stable on March 20, with trade light.

Market sources said that sellers were not interested in spot sales. shipments to China, where prices are among the lowest in the world, except for contracted volumes.

Although current glycol prices are close to the cost of coal-based glycol production, there is no real reason to run because there is no demand and the macroeconomic outlook remains very uncertain, sources

Traders said. High energy and inflationary prices due to macroeconomic uncertainty. upcoming MEG plants in 2023 will add to the oversupply, but may be delayed

Traders said companies planning to open these plants were not commenting, but market watchers said the coal-fired plants already in place were at lower rates than not starting at all because of the investments already made.

Traders said that the impact of the Regional Comprehensive Economic Partnership (RCEP), regarding the RCEP for MEG, is not yet clear. However, RCEP will replace several existing bilateral free trade agreements between the participants, the

traders said. the RCEP is expected to accelerate the outbound movement of low-cost manufacturing. China and lower tariff barriers for Chinese MEG importers buying from member countries, provided their manufactured goods are re-exported to member countries.

This will accelerate the transfer of labour-intensive cheap labour from China to the textile industry in Southeast Asian countries such as Vietnam, while focusing on high-value exports in the "Belt and Road" initiative, the sources said. This could put countries that are not in the RCEP at a disadvantage.