Weakening feedstock costs and demand tank NWE PET prices below Eur1,000/mt

10-Aug-15

The Northwest European polyethylene terephthalate net contract and spot prices fell, according to Platts data. The NWE PET net contract price was assessed at Eur990/m FD NWE Wednesday, the first time it's fallen below Eur1,000/mt since April 1. It also marked a Eur60/mt fall in one week, shedding 6% for the largest weekly change since mid-March NWE PET spot price was assessed at Eur985/mat ($1,073/mt) FD NWE Wednesday, down Eur35/mt week on week. It was last assessed below Eur1,000/mt on March 18. The NWE net contract price has been on a downward trend since the end of May, as a combination of weaker raw material prices and slowing demand placed downward pressure on prices. The net contract price follows closely the contract prices of its raw materials, monoethylene glycol and paraxylene. In August, market sources expect lower MEG and PX contract prices, placing additional pressure on the net contract price. The NWE spot price saw a surge in prices in the first five months of the year on strong buying activity, as converters built up stock as prices steadily increased. Since May, the spot price has spiraled downwards, as converters depleted stocks which they accumulated rather than committing to new purchases. Low buying interest meant that producers suffered high stock levels, weakening their bargaining position. Despite reported improvements in spot demand, the spot price fell on Wednesday on bearish raw material prices and the expectation that the uptick in demand will be short-lived Competitive import prices have also kept the spot price depressed