MEG port inventory in East China to gradually increase

Given the active purchases prior Chinese New Year, MEG inventory in polyester plants also increased. Currently, port inventory remains stable but is expected to increase with more cargoes arriving and the end of pre-holiday purchases.

In addition, China domestic output is also recovery with the restarts of Sinopec Yangzi and Sinochem Quanzhou. ZPC and Fund Energy will also restart this week and are expected to get products within the week. Meanwhile, Weihe Binzhou Chemical and Jianyuan plan to restart in end Jan. If all the restarted units could ramp up operating rate smoothly, MEG plant operating rate could reach to around 70% in early Feb and coal-based operating rate could reach 57-58%. The offtake in port areas may also slow down with the recovery of China domestic output