Diethylene Glycol, commonly known as DEG, is an important industrial chemical used in many everyday products and processes. It is widely used in automotive fluids, textiles, coatings, resins, and plastic-related applications. Because DEG is linked to several major industries, its price often moves in line with broader economic activity. When manufacturing slows down, DEG demand usually drops. When industries grow, demand picks up. For this reason, understanding the DEG Price Forecast is helpful for manufacturers, traders, and buyers trying to manage costs and plan purchases.
In Q3 2025, the global DEG market saw a clear shift in direction. Prices fell across all major regions, reversing the upward trend that had been seen in Q2. The decline was sharp in some markets and moderate in others, but the overall pattern was the same everywhere. Weak downstream demand, high inventory levels, falling feedstock costs, and ongoing economic uncertainty combined to push DEG prices lower worldwide.
This article explains what caused the price decline in Q3 2025, how different regions were affected, and what the DEG price forecast looks like for the near term.
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What Drives DEG Prices?
To understand DEG price movements, it helps to first look at the main factors that influence the market. One of the biggest drivers is downstream demand. DEG is used heavily in automotive products, textiles, and coatings. When these industries slow down, DEG consumption falls quickly.
Feedstock costs also play a major role. DEG is derived from petrochemical processes, so changes in upstream raw material prices can directly affect production costs. When feedstock prices weaken, DEG prices often follow.
Inventory levels and buyer behavior are also important. When inventories are high, buyers feel less pressure to purchase. This usually leads to cautious buying and lower prices. Finally, overall economic confidence influences purchasing decisions. In uncertain times, companies tend to reduce spending and delay orders.
Global Market Performance in Q3 2025
During Q3 2025, DEG prices declined in every major global market. This marked a clear reversal from Q2, when prices had shown some improvement. The decline reflected a broad slowdown in consumption rather than any single regional issue.
China, one of the largest DEG markets, recorded a price drop of around 4% in Q3, compared to a 3% increase in Q2. This shift showed how quickly market sentiment changed as demand weakened and inventories rose.
In the United States and Belgium, prices fell sharply by about 20% each. These were the steepest declines among major regions and highlighted the extent of demand weakness in key industrial sectors.
Germany and Mexico followed closely, with prices declining by around 18%. These markets were also affected by slowing automotive and industrial activity, which reduced DEG consumption.
Regional Price Movements Explained
Asia
In Asia, China led the downward trend. Slower manufacturing activity, combined with sufficient supply and weakening feedstock costs, put pressure on prices. Buyers remained cautious and avoided building inventory, which kept prices under pressure throughout the quarter.
India showed mixed movements. CIF prices declined by around 2%, while Ex-Hazira prices dropped more sharply by about 7%. This variation reflected differences in local supply conditions, logistics, and buyer behavior. Overall, the trend in India was still negative, in line with the global market.
Europe
Europe experienced some of the sharpest price declines. Belgium and Germany were heavily impacted, with prices falling by 20% and 18%, respectively. Weak demand from automotive, textiles, and coatings industries played a major role.
European buyers were cautious, purchasing only what they needed in the short term. High inventory levels across the region reduced urgency and gave buyers stronger negotiating power.
North America
In the United States, DEG prices dropped by around 20% in Q3 2025. This sharp decline reflected weak downstream demand and a generally bearish market mood. Slower automotive production and reduced industrial activity directly affected DEG consumption.
Buyers in North America remained conservative, further reinforcing the downward price trend.
Middle East
In the Middle East, price declines were more moderate. Saudi Arabia saw a decrease of around 2%, while Kuwait recorded a 3% drop. These smaller declines reflected relatively stable supply-demand conditions compared to other regions. However, the overall trend was still downward, driven by weak global demand and lower feedstock costs.
Role of Downstream Demand Weakness
One of the main reasons behind the global price decline was weak downstream demand. Automotive production slowed in many regions, reducing the need for DEG-based fluids and components. The textile industry also faced challenges, with lower production and reduced export demand.
Coatings and related industries were similarly affected. When construction and industrial projects slow down, demand for coatings decreases, which directly impacts DEG consumption.
This widespread demand weakness made it difficult for the market to absorb existing supply, leading to price reductions.
Inventory Levels and Buyer Behavior
High inventory levels played a major role in keeping prices low. Many buyers already had sufficient stock and saw no need to purchase additional volumes. This lack of urgency reduced trading activity and forced sellers to lower prices to attract buyers.
Buyer behavior in Q3 2025 was cautious across all regions. Companies focused on conserving cash and managing existing inventory rather than expanding purchases. This cautious approach reinforced the bearish market atmosphere.
Market Sentiment by September 2025
By September 2025, DEG prices remained depressed across global markets. There were no strong signs of recovery, and market sentiment stayed weak. Consumers continued to buy cautiously, and sellers had limited pricing power.
The overall atmosphere in the market was bearish, with expectations that prices would remain under pressure in the near term.
DEG Price Forecast: What to Expect Next
Looking ahead, the DEG Price Forecast suggests continued weakness in the short term. Unless there is a meaningful recovery in downstream demand or a significant reduction in supply, prices are likely to remain low.
If automotive, textile, and coatings industries begin to recover, demand for DEG could improve gradually. This would help reduce inventory levels and support price stabilization. However, any recovery is expected to be slow rather than immediate.
Feedstock cost movements will also influence future prices. If upstream costs rise, DEG prices may find some support. For now, however, the market remains cautious.
What This Means for Buyers and Sellers
For buyers, the current market offers cost advantages. Lower prices provide an opportunity to manage expenses, but buyers should remain careful about overstocking.
For sellers and producers, managing production rates and inventory will be critical. Aligning supply more closely with demand will help limit further price erosion.
Final Thoughts
In summary, the global DEG market experienced a broad and significant price decline in Q3 2025. Prices fell across all major regions, reversing the gains seen in Q2. Weak downstream demand, high inventories, falling feedstock costs, and economic uncertainty all contributed to the downturn.
By September 2025, prices remained depressed, and market sentiment stayed bearish. The overall DEG Price Forecast points toward continued caution in the near term, with any improvement depending on a recovery in demand or tighter supply conditions. Until then, the market is expected to remain soft and price-sensitive.
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About Price-Watch AI
Price-Watch AI is an independent raw material price reporting agency that provides real-time price forecasts and data-driven insights into global raw material markets. Price-Watch AI specializes in tracking raw material prices, analyzing market trends, and delivering timely updates on plant shutdowns, supply disruptions, capacity expansions, and demand-supply dynamics. The Price-Watch AI platform empowers manufacturers, traders, and procurement professionals to make faster, smarter decisions. Leveraging AI-powered forecasting and over a decade of historical data, Price-Watch AI transforms market volatility into actionable opportunity.
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