MEG fundamentals is likely to keep healthy in short term on low imports and pilot shortage

MEG fundamentals is likely to keep healthy in short term on low imports and pilot shortage. Total MEG inventory is expected to decrease by around 90-100kt in September and is hard to see clear increase in October. Imports are also hard to increase. China domestic output recovers slowly, as some units cut output amid the power restrictions, coal-based MEG margins weaken on higher coal prices and some units restart slowly after encountering problems.

In demand side, the cut back on electricity is ongoing and eyes could rest on further reduction in polyester plants.