Pic: Adobe Stock The global ethylene market is currently experiencing significant oversupply, with capacity exceeding demand by 10 to 15 per cent. Asian markets, led by China, have added significant capacity, resulting in low utilisation rates and margin pressure. On the other hand, European ethylene production fell 3.2 per cent year on year (YoY), reflecting weak demand in packaging and automotive industries.
The global ethylene market faces a 10 to 15 per cent oversupply, largely from Asia, pressuring margins and reducing utilisation rates, while European demand falls. The polyethylene sector projects a 30 million ton surplus, with increased exports from the US and Asia. Meanwhile, the methanol market grows with new capacity from Malaysia and higher production in North America.Global polyethylene capacity in 2024 will surpass demand by 30 million tons/year globally. Increased US and Asian exports are exacerbating the imbalance. Key players are scaling back expansions and diverting exports to markets with higher growth potential (e.g., Africa and South America).
Meanwhile, the methanol market sees a boost with the initiation of the Sarawak Methanol Project in Malaysia, which adds 1.7 million tons per year to global capacity. North America also expanded methanol production, contributing to a 6 per cent YoY increase in global supply. Demand for methanol remains stable, with some growth in derivatives like formaldehyde and methyl tertiary butyl ether (MTBE) for fuel blending.
SBS Zipper News Desk (AJ)
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