In Asia, PET producers anticipated firmer expectations for the period after the Chinese New Year holiday, as per ChemOrbis. However, last week, prices followed a stable to US$10/ton softer trend on the back of the lower upstream costs. Yet, the market sentiment still remains strong for the upcoming period since producers’ stock levels are comfortable and the high season for PET, in March, is just around the corner.
Asian PET producers had issued increases before start of the Chinese New Year holiday as they lifted up their prices by US$10-20/ton on FOB South Korea basis. Chinese producers had issued US$20-40/ton increases just before the holiday, citing the firmer upstream PTA and MEG costs as the main reason. However, towards the end of this past week, the Asian PET market closed on a stable to US$10/ton softer note given the lower upstream costs, pulled down by the softer energy markets. Spot Asian PTA prices retreated by US$30/ton, MEG prices lost US$45/ton when compared to the beginning of the month, and PX prices softened by US$5/ton. This past week, export offers for Chinese PET held steady while export offers for South Korean PET decreased US$10/ton on both ends of the price range. Inside China, domestic prices retreated by CNY100/ton (US$16/ton). However, producers are still very comfortable with their stock levels as they do not feel under sales pressure. Plus, they feel confident about demand given the fact that March is a traditional high season for PET applications.
A source at a Chinese producer told ChemOrbis, “Despite the fact that spot PTA and MEG prices lost some ground this past week, we kept our prices unchanged as we are holding very low inventory levels.” Another source from a different Chinese producer highlighted, “Although we lowered our export and domestic prices this past week, we are still aiming to adopt a firm stance regarding our prices and we are not willing to offer further discounts. “We think that prices are not likely to post any significant decreases as PX costs remain strong and demand is expected to be healthy in March,” further added the source. A different producer noted, “We kept our prices stable and we have no plans to revise down our offer levels. It’s normal for prices to retreat following the previous hikes and we believe that PET prices will remain firm over the short term. Demand is normal for now and in spite of the fact that we are running our plants at full capacity we still hold very limited stocks.”