Ethylene oxide prices remain stable.

1. Today's Summary

1. Sep 25: Iran proposed a 7-day plan to the US to advance peace talks. If accepted by the US, the Strait of Hormuz will be fully opened, leading to a drop in international oil prices. NYMEX crude oil futures (November contract) closed at $92.41/barrel, down $2.20/barrel (-2.33% WoW); ICE Brent crude futures (November contract) closed at $104.32/barrel, down $2.28/barrel (-2.14% WoW). China INE crude oil futures were suspended for the Mid-Autumn Festival holiday.

2. Sep 25: The port-side ethylene USD CFR Northeast Asia price was $1,180/ton, unchanged from the previous working day.

2. Spot Market Overview

Table 1: Domestic Ethylene Oxide Price Summary (Unit: RMB/ton)

Ethylene oxide (EO) is expected to maintain its high-level trend. On the supply side, ethylene glycol (MEG) prices have declined, and there has been no significant increase in EO supply; downstream industries are maintaining follow-up purchases based on rigid demand. On the cost side, domestic ethylene spot availability is limited, with contracts being the primary mode of transaction. Performance in derivative markets has strengthened, but market buying remains driven by rigid demand. Overall, both supply and cost sides continue to support the market in the short term, keeping EO prices firm. Continued attention should be paid to dynamic changes upstream and downstream.

3. Production Dynamics

Today, the capacity utilization rate of China's ethylene oxide industry stood at 49.26%. As of the previous working day, the theoretical profit for EO produced via imported ethylene sourcing was 1,583.27 RMB/ton. The theoretical profit for EO produced via domestically sourced ethylene today was 1,387.5 RMB/ton, representing a week-over-week increase.

4. Price Forecast

Ethylene oxide is expected to likely maintain its high-level trend in the short term. On the supply side, related product MEG prices have retreated from highs, shrinking profit margins for co-production units making MEG. Some units anticipate switching production to EO, and one EO unit is expected to start up, potentially increasing EO supply. On the demand side, downstream industries are maintaining follow-up purchases based on rigid demand, but the market lacks substantial transaction volume, and new order follow-ups are limited. On the cost side, domestic ethylene spot supply faces no pressure, market buying remains driven by rigid demand, while willingness to bid back derivatives has increased. Overall, fundamental fluctuations are limited, and EO prices may remain stable. Continued attention should be paid to dynamic changes upstream and downstream.

5. Related Products Status

① Ethylene (Raw Material): The East China ethylene market saw slight softening, with mainstream transaction prices ranging from 9,300-9,400 RMB/ton. Producers in the East China region face no shipping pressure, but constrained by minor low-price occurrences in peripheral regions, willingness to bid back derivatives increased today, leading some suppliers to offer small concessions.

② Polycarboxylate Superplasticizer Monomer (Key Downstream): For the next working day, domestic polycarboxylate superplasticizer monomers may decline weakly. The key raw material, EO, may remain stable. Supply-demand within the market is trading steadily without obvious contradictions. There is no supply pressure for ethylene within the market, but some low-priced cargo is flowing in. Downstream derivative buying interest is average, so prices may soften slightly, though cost-side support exists. Replenishment demand from downstream users of the monomer is insufficient, with risk-averse operations prevailing and cautious release of spot orders; transactions are negotiated based on volume. In summary, the main East China EPEG price is forecasted to range between 10,800-11,100 RMB/ton.

③ Ethylene Glycol (Related Product): Geopolitical changes are limited, and the MEG supply-demand structure shows a weakening trend. Currently, downstream resistance to high prices prevails, and restocking needs are mostly in a wait-and-see mode, leading to downward adjustments in the market. Tomorrow's East China spot self-pickup price is estimated to be in the range of 6,600-6,700 RMB.

6. Data Calendar

Table 2: Domestic Ethylene Oxide Data List (Unit: 10,000 tons)