Diverging Diethylene Glycol Price Trends Across Global Markets in H1 November 2024

In the early half of November 2024, Diethylene Glycol (DEG) prices displayed mixed trends across global markets, influenced by varying regional factors such as supply disruptions, seasonal restocking, and weak downstream demand.

In European market, DEG prices experienced a modest increase, of 0.99%, particularly in Germany, during the first half of the month, driven by constrained supply conditions. Seasonal restocking ahead of winter, particularly for its application as an anti-freezing agent in deicing, also contributed to the price uptick. However, demand for DEG from downstream PET and antifreeze sectors remained limited, dampening further gains. Additionally, the availability of feedstock Ethylene Oxide was sufficient, keeping feedstock costs balanced and exerting minimal upward pressure on DEG prices.

In the United States, DEG prices rose by 1% during the same period, largely due to supply disruptions caused by Hurricane Rafael. The Bureau of Safety and Environmental Enforcement activated its Hurricane Response Team to oversee offshore oil and gas operations in the Gulf of Mexico. As a precautionary measure, personnel were evacuated from several production platforms, leading to a temporary halt in oil and natural gas extraction and transportation. These disruptions created supply tightness in the DEG market. However, demand from the downstream resin and antifreeze sectors remained subdued, limiting the overall price increase.

Meanwhile, the Asian market showed a declining trend for DEG prices, with a 1.15% drop, particularly in China. This decline was primarily attributed to low consumption from downstream resin production, which led to an inventory buildup in the region. Demand for DEG in China was moderate, reflecting the sluggish performance of resin manufacturing industries. Additionally, the construction sector, a significant consumer of DEG, faced a substantial slowdown. China’s struggling real estate market continued to hinder construction activity, further impacting DEG demand. Data from the National Bureau of Statistics (NBS) revealed that the country’s construction Purchasing Managers' Index (PMI) fell by 0.59% in October, declining to 50.4% from 50.7% in September. This slowdown in the construction sector compounded the weak demand for DEG in the region.

Looking ahead, analysts predict divergent trends for DEG prices across regions. In the U.S., prices are expected to continue rising, supported by tight supply and potential production disruptions. In contrast, the Asian market is likely to remain weak, as limited feedstock cost support and subdued demand persist. Meanwhile, DEG prices in Europe are expected to remain stable, given adequate inventory levels and lackluster demand from key downstream industries.