The Triethylene Glycol (TEG) market in the United States concluded the fourth quarter of 2023 with a remarkable upturn, sending ripples across global markets. The driving forces behind this surge was primarily attributed to increased production costs and a concurrent rise in the value chain, particularly in ethylene glycol prices. The combination of these factors created a bullish market condition for TEG, affecting both domestic and importing countries.

Equistar Chemicals, LP, a key player in the sector, responded to the mounting production costs and increased demand from downstream antifreeze industries by announcing a substantial price increase for TEG from December 15th, 2023, and is likely to continue till January 2024.

Concurrently, on the global stage, Kuwait's Equate Petrochemical Co., a major player in polymers and petrochemicals, declared an upward revision of ethylene glycol prices for January. This decision was driven by the challenges posed by dwindling supplies from the Middle East, further accentuating the global nature of the glycol market and the interconnectedness of its various components including MEG (Mono-Ethylene Glycol), DEG (Di-Ethylene Glycol) and TEG.

Looking ahead, in the upstream sector, Monaca, Pennsylvania, witnessed a notable maintenance shutdown from the end of October 2023 to early December 2023. This further elevated TEG production costs due to constraints in feedstock supply to the market. On the other side, the demand side of the equation painted a nuanced picture. End-users, displaying a cautious approach, engaged in bulk purchasing in anticipation of market shifts. The anticipated surge in end-use demand at the onset of the year contributed to a bullish trend in the demand side.

The repercussions extended beyond the borders of the United States, influencing importing nations such as China, Europe, and India. The higher TEG prices in the U.S. had a positive ripple effect on these countries. In Europe, particularly, the improved margins for the product provided a welcome relief after grappling with low margins in the preceding months. The region also experienced a substantial uptick in demand for TEG, notably in the automotive, pharmaceutical, and textile sectors.

Looking ahead, ChemAnalyst offers insights into the future trajectory of TEG prices. The prediction is that prices will continue to improve at the commencement of the new year in 2024. This optimism is grounded in the expectation of heightened restocking activity driven by increased demand from the antifreeze industries. However, amid these positive projections, Equistar Chemicals has also raised its margin for TEG on 15th December 2023, and is expected to continue till January 2024, considering higher ethylene glycol prices.