In the China ethylene glycol (EG) market, supply is tightening. The inflow of Middle Eastern cargoes, including those from Saudi Arabia, decreased following a deterioration of the Middle East situation. Furthermore, domestic EG facility operating rates declined to around 66% due to feedstock shortages, leading to thinner supply. As a result, inventories at ports fell to 86,000mt.

　 Meanwhile, due to sluggish polyester demand, buying activity for feedstock EG is limited.

　 EG import volumes are likely to remain limited due to continued difficulties in navigating the Strait of Hormuz. Conversely, as two new EG facilities are scheduled to start up in October onwards, supply tightness of domestic cargoes may ease.

　 Regarding domestic demand, orders are decreasing as the October-December quarter is a low-demand season for polyesters in winter. Furthermore, firm prices for paraxylene (PX), which is also a feedstock for polyesters, appear to be contributing to a worsening of profitability for polyester manufacturers. Polyester manufacturers may implement facility shutdowns or production cuts. Under these circumstances, EG prices lack upward momentum for the October-December quarter.