Global PET prices have been losing ground in markets including Italy and China on the back of the weaker buying interest as well as the softer upstream costs, as per Chemorbis. In Europe, May MEG contract prices indicate a decrease of €66/ton (US$94/ton) compared to April settlement mainly due to the higher euro/dollar parity. Meanwhile, PX contracts also shed a significant amount of €100/ton (US$142/ton) compared to the April settlement while the May contract price is the first settlement to drop below €1200/ton (US$1714/ton) since February. In the spot market, PX offers are US$60/ton lower with respect to the beginning of May. In Italy, May PET prices shed €100/ton (US$142/ton) when compared to April on the back of the softer upstream costs as well as the comfortable supply levels in the region, caused by the incoming import cargoes, and weak demand for PET bottles.
For gentlemen’s agreements, May offers lost ground following mostly a stable month in April. A South European producer issued a €50/ton (US$71/ton) decrease when compared to last month, managing to conclude some deals at their new lower prices. The producer mostly highlights the slow PET demand in the country for their price cut decisions while speculating that the current weak market sentiment is likely spill in to June, too. In the spot market, a South European producer reported lowering May prices by €100/ton, managing to sell some materials after their price cut. According to him, more import cargoes are making their way to Europe on the back of the favorable euro/USD parity and causing overall supply levels to increase. “This situation coupled with lower costs push us to reduce our offer levels amidst already poor demand,” he lamented.
Looking at the Asian market, a similar downward trend is also observed as South Korean producers’ export PET prices lost US$50-60/ton on FOB Busan basis when compared to the previous week on the back of the softer upstream costs and slow demand. In China, export offers were also lower by US$20/ton at both ends of the overall offer range on FOB China basis compared to the previous week. Plus, the high end of the offers became scarcer towards the end of the week, according to the players’ reports. Meanwhile, PET producers are willing to offer additional discounts in return for firm bids in order to generate some buying interest as they are still supported by their comfortable margins. Looking at the upstream costs, spot PX offers lost ground by US$65/ton on FOB Korea basis while spot PTA retreated by US$120/ton and spot MEG lost US$40/ton on CFR China basis when compared to the beginning of May.