Increasing PTMEG plants suspend production for maintenance

Price of PTMEG has remained low and the pressure from losses enlarged. The operating rate of spandex plants gradually rose to above 80% after the Spring Festival holiday, ending up with warmer demand for PTMEG. However, supply of PTMEG remained excessive. Under competition, the PTMEG plants faced big selling pressure. Increasing PTMEG plants plan to shut down for turnaround with ongoing losses and selling pressure. The operating rate of PTMEG plants is anticipated to decline apparently.

According to the statistics from CCFGroup, the capacity of units that have started turnaround or plan to have maintenance in the second half of Mar totals 478kt/year, accounting for 35.4% of the current total capacity. The operating rate of PTMEG plants will gradually fall to around 60% after units having turnaround next week. Jiaxing Hyosung and Blue Ridge Tunhe also intend to have turnaround in Apr.

This round of turnaround during the traditional peak season includes scheduled turnaround, and ongoing losses are another critical reason. Price of PTMEG has been low since the second half of 2024 and factories encountered increasing pressure from losses but the price remained low due to the inner competition pressure.

Price of PTMEG sustained low and factories have suffered losses for a long period and started facing burden. Burdened by losses pressure for a long period, some units consider choosing more economical operation status.

In addition, with big inner competition pressure and impacted by low-priced resources and under losses pressure, some factories gave up price competition and became flexible in sales.

The gap between medium-priced goods and low-priced resources apparently widened from the second half of 2024. The low-priced resources greatly impacted the mainstream goods and high-priced products. With losses and price gap, to avoid price competition, the supply of some resources reduced a lot, resulting into apparently diversified sales ratio among companies.

Oversupply of PTMEG is anticipated to be eased later under large-scaled production suspension. However, as the supplying capability remains big, the adjustment in supply side may take long. Medium-to-low operating rate of PTMEG plants may also become a normal status.