Sinopec Shanghai Petrochemical MEG Unit Shutdown Influence
It is learned that Sinopec Shanghai Petrochemical’s MEG units were shut down temporarily on June 18, 2022, and the restart time is uncertain. The company’s MEG units have two production lines. Line 1 is 2,300kt/a MEG unit which mainly produced EO before. Line 2 is 380kt/a MEG unit which ran at a low load before. Influenced by this shutdown, China’s MEG output in June is predicted to decrease to about 1,080kt. Besides, given that many MEG units are under maintenance, the MEG supply is expected to show a downtrend in the near term, which may improve supply-demand imbalance and then support MEG spot prices to go up. However, the operating rates of downstream PET units still have no obvious increase, curing the demand for MEG. Thus, it is anticipated that the MEG market may return rangebound after a short-time upward movement.
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