Current situation of ethylene glycol market
In September, the price of ethylene glycol continued to rise
The price of ethylene glycol will soar in 2026, and the current price has reached a new high in nearly 4 years. As of September 8th, the average spot market price for domestic oil to ethylene glycol traders was 6458.33 yuan/ton, an increase of 67.13% from the market average price of 3864.17 yuan/ton at the beginning of the year (January 1st).
Port paper goods are mainly priced based on basis, with prices closely following fluctuations in the futures market. Recently, the futures price of ethylene glycol has risen significantly, and the base quotes of port paper cargo ethylene glycol base traders are high and firm. The contract basis for this week is 900-940 yuan/ton, and the quotation range is 6700-6900 yuan/ton.
Domestic coal to polyester grade ethylene glycol spot (loose water, tax included, self pickup) vehicle manufacturers have raised the auction price to 6050-6400 yuan/ton.
2. In September 2026, the inventory of ethylene glycol at the port was extremely low
On September 7, 2026, the total spot inventory of ethylene glycol in the main port of East China was 120000 tons, a decrease of 296000 tons from the total spot inventory of ethylene glycol in the main port of East China on July 30, which was 416000 tons; Compared to March 2nd, the total spot inventory of ethylene glycol in the main ports of East China was 926400 tons, a decrease of 806400 tons in inventory
At present, the inventory of ethylene glycol at ports is extremely low, setting a new historical low.
Houthi militants warn of Saudi energy facilities’ impact on ethylene glycol prices analysis
1、 Basic pattern of China’s ethylene glycol import
1. China’s total import dependence on ethylene glycol is about 27-28%, with a total import of 7.72 million tons by 2025.
2. Saudi Arabia is the largest source of ethylene glycol in China: imports from Saudi Arabia account for 54-55% of the total import volume, about 4.22 million tons per year; The overall Middle East accounts for over 71% of imports.
3. The ethylene glycol petrochemical bases in eastern Saudi Arabia, such as Jubail, heavily rely on the Strait of Hormuz for product exports; The shipment of the West Coast device will take place through the Red Sea Mandeb Strait, both of which are within the threat range of Houthi armed attacks.
4. There is coal to ethylene glycol production capacity in China as a hedge, but it is difficult to fully compensate for the significant shortage of Saudi Arabia’s supply in the short term.
2、 Key points of this event (news)
The Houthis have publicly warned that all important energy and industrial facilities in Saudi Arabia are legitimate targets of attack, in retaliation for Saudi military actions. Not only sea vessels, but also Saudi domestic petrochemical and oil and gas facilities are directly included in the threatened list.
The risk is divided into two layers: ① the risk of Saudi Arabia’s local ethylene glycol production plant being attacked and shut down; ② Persian Gulf and Red Sea shipping are under attack, posing a risk of disruption to export logistics.
3、 Transmission path of price increase
1) Emotions and Risk Premium
The expectation of supply interruption in market transactions does not necessarily mean that the device has been blown up.
If there is a risk of attack on the Saudi ethylene glycol petrochemical industrial zone, overseas traders will immediately raise their FOB prices; Domestic long funds will trade on the expectation of import reduction, while futures and spot prices will quickly rise.
Two shipping routes are under pressure simultaneously: the eastern route via Hormuz and the western route via the Red Sea’s Mandeb Strait. The Houthis are threatening the entire Saudi Arabian territory, and neither route can completely avoid danger. Shipping companies will add war risk and some ships will detour around Cape of Good Hope, resulting in a significant increase in sea freight costs and further pushing up the cost of arrival.
2) Scenario 1: Only verbal warning without actual striking device
The actual supply of goods has not been substantially interrupted, only the shipping risk has increased.
Price: Pulse like increase, risk premium, limited sustainability. Once the conflict does not escalate, the premium will quickly fall back; Domestic port inventory and arrival forecasts will once again dominate the market.
3) Scenario 2: If Saudi Arabia’s oil/petrochemical (ethylene glycol) plant is actually hit and damaged
Saudi Arabia has a total production capacity of 7.75 million tons of ethylene glycol, making it one of the world’s largest export destinations.
1. Equipment damage and parking: directly reducing global ethylene glycol export supply, China loses hundreds of thousands of tons of Saudi Arabian goods every month; The total amount of alternative sources (Canada, United States, Kuwait) is limited, making it difficult to fill the gap in the short term.
If there is an attack on the waterway, ships will seek refuge, and the arrival volume will significantly decline. Domestic port inventory will quickly deplete, and spot prices will continue to strengthen, with contracts in the near month far stronger than those in the far month.
3. Crude oil prices have risen synchronously, and Saudi Arabia’s ethylene glycol is a naphtha/ethane route, which has increased raw material costs and further supported the bottom of ethylene glycol prices.
4) Domestic hedging forces (restraining the upward trend)
1. The increase in domestic coal to ethylene glycol production capacity and the rise in coal to ethylene glycol operating rates after price increases can offset some of the import gap.
2. Downstream polyester demand, if raw material prices rise too quickly and weaving and polyester factories resist, there will be a decrease in load, which in turn will limit the space above ethylene glycol.
4、 Current market reality constraints
1. The Houthis have issued similar warnings multiple times in the past, with verbal threats outweighing actual attacks on production capacity. The biggest characteristic of geopolitical drive is its volatility, with the market rising and falling quickly, and highly depending on whether the conflict is resolved.
2. The current inventory location and monthly actual arrival forecast of ethylene glycol ports in China are the core indicators for verifying whether geopolitical factors are truly transmitted to domestic physical goods; If the arrival volume does not significantly decline, the market’s geopolitical premium will gradually be absorbed.
3. Far month contracts are more dependent on the increase in domestic production capacity, as geopolitical conflicts have a weaker driving force on the far month than in the near month, which can easily lead to a near strong far weak structure.
5、 Summary
1. Because over half of China’s ethylene glycol imports come from Saudi Arabia, the Houthis have listed energy facilities throughout Saudi Arabia as targets for attack, which has brought an upward risk premium to ethylene glycol and is one of the catalytic factors for the recent price strengthening.
2. The market height depends on the follow-up: whether there is a real attack on Saudi domestic petrochemical facilities, and whether Persian Gulf and Red Sea shipping is actually obstructed. Only verbal intimidation, the market belongs to pulse speculation; Once production capacity or shipping is substantially damaged, ethylene glycol will experience a sustained supply driven increase.
3. Risk: If the conflict eases, the previous geopolitical premium will quickly rebound, while the release of domestic coal production capacity and weakened downstream demand will suppress prices.
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