Core Insights - The demand for polyethylene terephthalate (PET) is strong and is expected to support stable growth in the ethylene glycol market in the long term, but the market needs to digest new capacity in the short term to achieve supply-demand rebalancing [1][2] - The average operating rate of ethylene glycol plants has dropped below 60% due to annual new capacity consistently exceeding demand, with capacity growth outpacing demand growth by a factor of two [1] - China has become the main driver of capacity expansion in the ethylene glycol market, currently accounting for half of global production and increasing its self-sufficiency rate from below 50% to over 75% [1][2] Supply and Demand Dynamics - The oversupply situation is expected to persist, with North American ethane cracker operators not likely to reach breakeven until 2027-2028, while market recovery in Northeast Asia and Western Europe may not occur until after 2030 [2] - Global trade flows of ethylene glycol are primarily concentrated between the Middle East and China, with China projected to account for approximately 70% of global net imports in 2024 [2] - The U.S. has gradually become an important source of ethylene glycol imports for China, with its share reaching 13% by 2024, although imports from the U.S. have significantly declined this year [2] Future Outlook - Long-term demand for PET is expected to remain strong, providing support for stable trade growth [2] - Despite a slowdown in capacity expansion, the oversupply situation will take time to rebalance, and short-term uncertainties and policy fluctuations will exert pressure on the ethylene glycol market [2]