Recently, the crude oil market has continued to challenge the nerves of people around the world. Affected by this, the trend of the energy sector has been mainly red during the day, and ethylene glycol has also begun to stage a bargain-hunting drama.
Recent market performance – prices have bottomed out and risen.
The ethylene glycol market trend took on a V-shaped pattern at the end of March and early April. First, at the end of March, under the influence of weak crude oil and pessimistic demand, the price plummeted to a historical low of 2,890 yuan/ton, and then the price hit bottom. Repair, in April, with the stabilization and recovery of crude oil prices, the overall negotiation atmosphere of the market rebounded, and the absolute value of the price was low, which also stimulated the market’s desire to buy short-term bottoms. With the closing of short positions and the participation of short-term and long-term sentiments, B2 The first shot of the rebound was launched in April.
Reflecting the increase in production and sales during the Second Year
Take polyester filament as an example. Due to the sluggish demand after the holiday, domestic demand and foreign orders and doubles Under the shrinkage, the overall orders are sluggish, the industry’s production and sales performance is sluggish, and occasional price reduction promotions will also be difficult to stimulate the downstream’s steady desire to receive goods. In addition, several “bottom hunting” purchases in the early stage, and the continued decline in prices in the later period, also made downstream passive. Withstanding the pressure of high-priced raw materials, the momentum of taking orders has been suppressed to a certain extent. However, the recent release of crude oil-level peace talks (especially the low absolute value) has once again stimulated the momentum of downstream orders and goods to amortize the loss of high-priced raw materials in the early stage. Therefore, production and sales have increased in recent days, and the pace of downstream destocking has also been bright. At present, the polyester filament inventory has dropped from the previous peak of around 35 days to the current 27-28 days, and the short fiber inventory has dropped from 10-11 days to the current 8-9 days. The price increase has become an important motivation for destocking. .
However, hidden dangers in the market remain – the pressure on the weaving process continues unabated.
Due to shrinking orders, the current operating rate of the weaving industry has dropped from about 70% after the holiday to around 53% currently. Public health incidents in the global atmosphere are still fermenting, and the recovery of foreign orders before May is far away. Domestic orders have also been affected by economic pressure and are not as strong as last year. Therefore, the production and sales driven by prices this time are more about the transfer of inventory from polyester to terminal/intermediate traders, rather than the actual digestion of inventory.
So the improvement of crude oil is both a good thing and a foundation. It is also very likely that the undervalued ethylene glycol will return to the value center. However, after the rebound, we return to the fundamentals. The accumulation of terminal inventories will not decrease, and terminal stocks will not be reduced. Due to the poor start-up of the link, the market rebound will be difficult to achieve overnight; in addition, we still need to pay attention to which way the wind will blow in the later period of crude oil, the source of chemical industry. </p
