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China: Global MEG Market Probably to See Surplus Capacities This Year

https://www.chemnet.com   Jul 29,2010
As the largest consumer of MEG in the world, China would digest out one-third of global MEG consumption in 2010. From 2008-2010, new 2.21 million t/y capacities mushroomed in China while 1.61 million t/y of which had passed the examination and approval. It is predicted that total capacities in China would reach 4 million tons or so while total demand might be around 7.1 million tons.


According to some analysts, global consumption was predicted to amount to 21.88 million tons this year, with total capacities reaching 27.09 tons. As a result, China’s MEG market would probably be impacted negatively by low-cost products from Middle East.


Besides, China would see fierce competitions among global MEG producers in the next few years. As large MEG project in Asia put into operation, the tightness in China may be somehow eased. However, demand still could not be satisfied to a large degree. Thereby almost all world large producers pressed on with the facilities constructions and expansions. Meanwhile, market share of materials from Middle East countries like Saudi increased rapidly in China.


According to relevant data, imports exceeded 5.8 million tons in 2009, up 12% compared with 2008. From 2000-2008, average annual growth rate of MEG consumption was around 18.4% while that of MEG supplies was around 12.3%. As a result, growth of domestic capacities was far not enough for the growing demand.
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