Shanghai, China: On Monday morning, Shanghai Petrochemical closed its Mono-Ethylene Glycol units after a fire broke out. Despite the closure of the Mono-Ethylene Glycol unit, the price of Mono-Ethylene Glycol kept declining in the Asian market. This drop in cost came from easing crude oil value and declining demand. Further, bearish demand in Europe and other Asian countries increased the import volume of the product to China's market.

Since May, the price of Ethylene Glycol has fallen throughout Northwest Europe; owing to higher prices of raw material Ethylene, suppliers give priority to the European market, which resulted in an ample supply of the product to its domestic market. Meanwhile, Mono-Ethylene Glycol demand in antifreeze is low, and the operating rate of Polyethylene Terephthalate plants also declined with soaring production costs.

In addition, Malaysia's PRefChem's cracker has not yet begun, and the restart of its 750kt/year Mono-Ethylene Glycol unit has been postponed once more without any update on the restart. The Mono-Ethylene Glycol plant was supposed to be restarted by late June. Supply from Singapore and Taiwan decreased with cargoes reallocating towards Europe and Southeast Asia. In contrast, Taiwan's supply lowered due to the extended closure of its Nan Ya Mono-ethylene Glycol unit.

But the coal-based Mono-Ethylene Glycol, Xinjiang Tianye, increased its operating rate and intended to restart its 300 kt/year unit. Shanxi Meijin also increased the operation rate of its 300 kt/year unit, and Hubei Sanjiang postponed the closure of its unit, leading to the rising inventories alongside the normal operating of the units.

On the other hand, Sinopec Yangzi Petrochemical planned to restart its Ethylene Oxide unit with a capacity of 300kt/year from June 24th. Still, it's mulling over its restart after the accident took place at Shanghai Petrochemical. Traders mentioned, If the units do not restart as planned, Ethylene Oxide price is anticipated to rise in the domestic market, which may lower the production of Ethylene Glycol.

As Per ChemAnalyst Prediction, "The price for Mono-Ethylene Glycol is expected to dip, even though Shanghai Petrochemical closed its units after the fire broke out. The reasons mentioned above could be justified, owing to the declining demand and smoothening Crude oil market value. Therefore, it is anticipated that China may import more Mono-Ethylene Glycol in July and August as a result of weaker demand in Europe and India.