BEIJING: China’s monoethylene glycol (MEG) imports in 2017 increased 15.6% to 8.75m tonnes, backed by a stronger-than-expected performance in downstream polyester markets. In 2016, the country took in 7.57m tonnes of MEG, according to China Customs data. Imports of the material grew at a double-digit pace last year, despite a 1m-tonne increase in domestic MEG production to 6.13m tonnes, as overall consumption grew 17.2% to 14.86m tonnes, according to ICIS data. China’s polyester sector had been strong amid improvement in the general macroeconomic conditions. The world’s second-biggest economy snapped six years of steady slowdown in 2017 to post a GDP growth of 6.9%, up from a 26-year low of 6.7% in 2016.
Capacity growth in polyester textile last year was estimated to have grown by around 11%, up from 3.6% in 2016, according to ICIS data. Market players were originally expecting a dismal growth of about 2.3% for 2017. Market participants expect China’s MEG imports to continue increasing this year in view of a 5-6%projected growth in polyester capacity. Despite continued expansion in domestic MEG production, the country has remained heavily reliant on imports, which accounted for 58.9% of the total consumption in 2017. In 2016, imports’ share to total consumption at 59.7%. China will continue to raise domestic production as it strives to be more self-sufficient on its petrochemical requirements, but this may be limited by a lack of feedstock ethylene in the country.
