Forecast posted on May 2021
This chart provides some historical context as well as forward projections that suggest MEG could go long globally in the next few years, although extended downtime in the USG preceded by several unplanned outages in Q4 led to severe availability constraints prior to the recent cold-induced outages. More recent downtime in the USG constrained spot availability and could lead to additional firming heading into June, possibly setting the stage for another round of increases in July. Markets in the Americas are insular at the moment with domestic assessments elevated (or near parity) relative to those in other major centers of trade. As previously noted anti-dumping measures in Europe and the high duties assigned to most US producers will make further exports to the region extremely difficult. Downstream needs both within the Americas and in both Europe and Asia remain robust so there should be only sporadic incremental volume for sale in the near term. Inventory levels in China are also at recent historical low points so we believe that market will remain well supported until production catches up perhaps later this summer at which point export oriented netbacks will set the price floor. Watch for planned downtime in Alberta during August and September and whether those plants come back up as expected for an indication as to whether US markets become more balanced.
*Please note forecasts are based on analysis of historical trends and cycles as well as expectations regarding future supply and demand patterns. The data is provided for informational purposes only and Chemical Intelligence does not assume any liability for any decisions attributed to reliance on said information.