MEG Weekly Report 29 April 2017

Weekly Price Trend: 24-04-2017 to 28-04-2017

• The above given graph focuses on the MEG price trend from 24th April to 28th April 2017.  
• Prices reduced slightly for this week in domestic market. Domestic prices were assessed at the level of Rs.53/Kg for bulk quantity with an decrease of Rs.1/Kg by end of the week. After significant rise in last week prices again reached the same level.

Booking Scenario

The above chart shows the international prices of MEG and its comparison from the previous prices.
INDIA & INTERNATIONAL

• This week domestic prices decreased by Rs.1/Kg for bulk quantity.
• CFR India prices were assessed in the range of USD 710-720/MTS. Prices reduced heavily for this week.
• CFR China values decreased by USD 5/MTS in compare to last week’s assessed values and were assessed in the range of USD 685-705/MT
• CFR SEA prices for MEG were assessed around USD 700/MT for this week. There has been slight reduction of USD 5 in compare to last week’s closing values. FOB Korea values for Ethylene was assessed around USD 1135/MTS while CFR China values for Ethylene were assessed around USD 1155/MTS.
• FOB Korea values for Propylene was assessed around USD 790/MTS while CFR China values were assessed around USD 815/MTS.
• One factor that could explain the downtrend in MEG prices was the 629,000 mt of inventory at Chinese ports -- a level considered very high. Bearish sentiment coupled with market volatility on cash flow issues faced by downstream polyester producers were other factors cited by market participants.
• As a result, margins last week hit minus US$183/mt, the lowest since October and after being negative since February. Market volatility has left most market participants bewildered at current price movements, as the outlook for MEG remains murky this week.
• Throughout the week oil prices remained volatile. As per recent records oil prices reduced sharply.WTI from $53 a barrel, down to $48 while Brent declined from $55 to $51. The falling oil means weakening of economy, the reality is that oil is being driven by increased supply. On Thursday oil prices have plunged as the resume of two key Libyan oilfields and concerns about dreary gasoline demand fed concern over whether major oil producers can lessen the glut of global inventories.
• On Thursday, closing crude values have decreased.WTI on NYME closed at $48.97/bbl, prices have increased by $0.65/bbl in compared to last closing prices. While Brent on Inter Continental Exchange decreased by $0.38/bbl in compared to last trading and was assessed around $51.44/bbl.
• As per market analyst As gas prices dropped, it created an undertow for the entire crude oil market. The outlook for oil prices will remain unstable. Decline in crude prices and therefore petroleum product prices also means corresponding reduction in prices of some of the raw materials for the petrochemical industry. Hence, it can be a factor in improving the profitability of that industry.

$1 = Rs. 64.24
Import Custom Ex. Rate USD/ INR: 65.55
Export Custom Ex. Rate USD/ INR: 63.85