Weakness persists in Asian PTA markets as feedstock paraxylene comes to standstill

Despite almost four dollar increase in crude prices, weakness persisted in Asian purified terepthalic acid (PTA) market as feedstock paraxylene (PX) markets stagnated last week. PTA values were also largely stable at US$830-840/ton CFR CMP last week. PX managed to recover 30% of the US$300/ton (€201/ton) it lost in August and September before its uptrend lost steam and stayed at US$920-930/ton CFR (cost and freight) Taiwan and/or China Main Port (CMP) in the week ending 23 October, as per ICIS pricing. The cost naphtha –the feedstock for PX rose in tandem with crude, further squeezing margins for PX producers. Producers are trying to raise prices to regain some profitability as naphtha costs continue to be a big squeeze on margins. Efforts to hike prices by the PX producers to generate margins, has been thwarted by buyers who expect additional supply by end of the year. Upto 34,000 tons of PX is expected in Asia in H1-December from Kuwait Aromatics’ new facility in Shuaiba. If the start-up at Shuaiba gets further delayed, it could provide a short-term boost to PX values.
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