Polyethylene terephthalate (PET) producers in Europe are looking to increase spot prices for October in anticipation of a tighter market, sources said in Platts.
Bottle-grade NWE PET spot price was assessed at Eur900/mt (US$1005/mt) FD NWE last Wednesday, rising from below Eur900/mt at the beginning of September. Discussions for October spot deals have begun and producers are trying to push up prices by Eur10-Eur20/mt, sources said.
In the UK, one spot deal for October was heard already concluded at GBP690/mt (US$1066/mt) on Wednesday, a GBP30 rise from the assessment last week
Scheduled maintenance by major PET producers, including Indorama and Lotte Chemical, combined with steady uptake in PET will tighten the spot market in the fourth quarter as contractual volumes are prioritized.
A major PET producer in mainland Europe said that they are currently not selling spot material, as they focus on contractual production. "We are not even quoting on spot, and have withdrawn at present. Demand cannot be met so spot is not considered," he said.
Demand continues to be firm, with many sources saying that buying has been strong for the time of the year. As a result, converter stocks are reported to be low. "I have seen customers come back strong. With depleted inventory they have to buy [at] higher rates", the PET producer said. Nevertheless, converters are reluctant to accept the price increases presented by producers. "[I] do not see the need to increase prices as we are entering a low season", a converter said.
The trader agreed that it was difficult to convince converters of the price increase. He expected a rollover of PET prices in October instead. A wait-and-see attitude for October is prevalent in the market, with negotiation power believed to be in the hands of both producers and converters.
"There is strength at present in the seller area I believe", the producer said.
"Everything will depend on the need of converters", according to the converter.