On December 23, ethylene glycol (MEG) hit another record low, with the main contract 2605 dropping over 3% intraday. Meanwhile, PTA, another upstream product in the polyester chain, broke through the 5,000 threshold this week. Despite being part of the same industrial chain, their fundamentals differ significantly.

MEG faces high domestic operating rates, with multiple new plants slated for commissioning in 2026, adding to supply pressure. In contrast, PTA is benefiting from tightening PX supply and rising prices, alongside sustained inventory drawdowns in December and low processing margins. This divergence between MEG and PTA is likely to persist in the near term.

**Supply Dynamics**: - A 400,000-ton/year MEG unit in South China has resumed normal operations after maintenance in early December. - A 200,000-ton/year MEG facility in Taiwan is restarting after being shut for maintenance in late November. - Fuhai Packaging Materials Co. has successfully produced premium-grade polyester bottle chips at its new 300,000-ton/year plant. - A 2.2-million-ton PTA unit in Ningbo is expected to restart on the 24th following maintenance in late November.

**Demand Outlook**: The market is currently in a seasonal lull, with attention turning to 2026 supply-demand expectations for PX and PTA. Polyester inventory destocking, promotional sales, and voluntary production cuts by major manufacturers have boosted recent sales volumes. However, declining downstream operating rates and potential early Lunar New Year shutdowns among struggling manufacturers may limit price support from demand.