MEG on Friday was assessed at $804/mt CFR China, but on Monday afternoon bids were between $830-845/mt CFR China. In comparison, there were fewer offers in the market with selling indications at around $860/mt CFR China.
There was little activity last week as China observed a three-day holiday and the Northeast Asian countries observed various holidays as well.
Market sources attributed the spike in MEG prices to the $90/mt surge in ethylene prices from Thursday to Friday to $1,141/mt CFR Northeast Asia. This was led by strong demand from Taiwan.
They also said downstream demand is starting to pick up from PET and polyester industries.
"The polyester market is doing quite well as well," said a polyester producer. "Some polyester staple fiber producers have already sold forward half a month's worth of inventory."
Meanwhile, the shortage of feedstock ethylene at Taiwan's Nan Ya Plastics has led to tighter MEG supply, helping to support prices. The company has idled two of its three 350,000 mt/year MEG lines at Mailiao on ethylene shortage after its affiliate Formosa Petrochemicals shut its steam cracker due
to a fire. The company is still running its 350,000 mt/year and 700,000 mt/year lines at full capacity.
China will observe another long holiday starting Friday through next Thursday when the market is expected to come to a standstill again.
China Chemical Weekly: http://news.chemnet.com/en/detail-1411716.html
