PET prices firm up globally

In the PET markets of Asia and Europe, prices are under upward pressure from the escalating feedstock markets, as per Chemorbis. In Europe, PET and PTA force majeures are also intensifying the situation. In Asia, spot feedstock costs recorded increases with respect to the beginning of February - PTA costs moved up by US$45/ton while MEG prices gained US$50/ton on CFR China basis. Meanwhile, spot PX offers rose by US$40/ton on FOB Korea basis. In China’s domestic market, the overall range gained CNY100-300/ton (US$15-46/ton) when compared with the previous week’s range. Producers, attributing higher prices to firm upstream markets, expect to see improved demand in the days ahead as most beverage factories resume normal operations following the extended Chinese New Year holiday. In the import market, South Korean PET prices gained US$50/ton at the low end while they moved up by US$10/ton at the high end on FOB Busan, cash basis. However, no major deals have been reported so far considering the large gap between the current buy and sell ideas. In China’s export market, the overall range gained US$50/ton hikes at the low end and US$30/ton hikes at the high end over the past week on FOB China, cash basis. Meanwhile, within the range, producers mostly elected to issue increases of US$20-30/ton, pointing to the firmer feedstock costs.Both producers and traders are complaining about slow sales and some are willing to concede to discounts in view of the slightly softened feedstock costs towards the end of the week- several others prefer to maintain their prices at their current levels. These sellers feel optimistic about the future trend as they are receiving an increasing number of inquiries from their overseas’ customers. In Europe, spot PX prices gained US$90/ton when compared to the beginning of February on FOB NWE basis. Meanwhile, PTA supplies are tight in the region due to BP’s force majeure at the PTA 3 plant. According to a company source, BP is currently running the plant at 85% capacity and is able to meet contractual obligations. However, the company is due to shut the plant on February 26 for 9-10 days of maintenance on the back of another technical problem, when it will reduce allocations to 30-40%. BP’s PTA force majeure has already affected the PET market as La Seda de Barcelona was also forced to declare force majeure on PET supplies last week due to lack of sufficient feedstock. La Seda reportedly put customers on 60-80% of allocation. As a result of these bullish developments, the PET market moved up in Italy, too.A domestic producer reported settling their gentlemen’s agreements with €180/ton increases from January, blaming the short PET supplies which have been triggered by tight feedstock availability. The producer does not think that the market panorama will change for the next month in terms of feedstock supplies and therefore he believes that March might be another strong month for PET prices. The spot PET market also followed a similar price trend as another domestic producer in Italy reported concluding spot deals with €160-170/ton increases over January. Meanwhile, buyers report that they have to accept these higher levels if they want to purchase PET when considering the current bullish conditions.