China’s December MEG imports hit 564,000 tonnes

SINGAPORE (ICIS news)--China’s monoethylene glycol (MEG) imports in December 2009 at 564,000 tonnes were highest ever for the country in any one month in the last four years, official trade statistics released on Thursday showed.

The average monthly imports during 2005-2009 were between 333,000-486,000 tonnes, with an annual composite growth rate of 10%, according to statistics by China Customs. The second highest MEG imports in one month during this period stood at 551,000 in September 2009.

China imported a total of 5.83m tonnes of MEG in 2009, up 12% from the previous year, according to the import data.

The spike in December MEG imports was partly attributed to shipments from the Middle East - nearly half of the December imports came from Saudi Arabia on the back of new capacities – and greater demand in the country, they added.

China imported 262,000 tonnes of MEG from Saudi Arabia in December, up 17% from November, according to the statistics.

The huge volumes of new supply emerged from two new plants in Saudi Arabia, operated by Eastern Petrochemical Co (Sharq) and Yansab.

Sharq started up its new 700,000 tonne/year MEG plant in mid-August, while Yansab’s new 700,000 tonne/year unit came on stream on 26 August, according to ICIS statistics.

The new plants were running at optimal rates and had been exporting MEG to Asia since November, a regional trader, who deals with Middle East cargoes, said.

China needs to meet almost three fourths of its total MEG demand through imports as domestic production in 2009 was estimated at around 2m tonnes, a regional market source said.

The import reliance was likely to continue until the start-up of new local plants in 2010, the source added.

Delay in the start-up of Sinopec and Saudi Basic Industries (Sabic)’s 400,000 tonne/year MEG plant at the northern city of Tianjin was another reason for high import volumes, the source said. The plant was originally scheduled to come on line in December 2009, but the start-up was delayed due to technical problems.

China was expected to add two more MEG lines in 2010, Sinopec Zhenhai’s 530,000 tonne/year line at Zhejiang and Panjin Petrochemical’s 200,000 tonne/year unit at Liaoning, another market source said.