Asian PET bottle markets shift direction after two-month uptrend

by Pınar Polat - ppolat@chemorbis.com

In Asia, PET bottle prices have retreated this week after following a stable to firmer trend since late February. ChemOrbis Price Index shows that the weekly averages of spot prices even hit a 5-month high in the first half of April. However, weaker upstream costs amid the oil`s recent fall have pulled the markets down this week, with the contribution of persistently sluggish demand.
ChemOrbis data also suggest that the recent downturn has dragged the weekly averages of FOB China/South Korea and CIF SEA down by $20/ton to stand at $1030/ton, $1065/ton, and $1055/ton respectively. Prior to this, spot prices gained around 11-12% during the two-month uptrend.

China`s local PET market also moves down
PET bottle prices inside China were also assessed CNY100/ton lower from the previous week at CNY7500-7800/ton ($958-997/ton excluding VAT) ex-warehouse, cash including VAT.
[Local prices have also fallen this week. China`s domestic supply has stayed balanced due to some plant turnarounds," said a trader. As for demand, another trader reported, [Even though the weather has turned warmer, downstream players continue to buy on a need basis only. We see no sign of replenishing extra material ahead of the labor holiday."
Meanwhile, the upcoming Golden Week Labor holiday in China will start on 29 April and last until 3 May.
Feedstocks echo oil prices
Having been underpinned by the surprise output curb of OPEC+ in early April, energy values have been displaying a weaker performance recently with deepening concerns over an economic slowdown. Unsurprisingly, this has found a direct reflection on the feedstocks of PET.
ChemOrbis data also show that spot PX and PTA prices also fell to $1120/ton and $845, respectively, on a CFR China basis, down by $20/ton weekly. Meanwhile, MEG prices stabilized at $510/ton on the same basis.
PET players are now closely watching the movements of energy prices, which are facing opposite pressures. On one hand, fuel demand in China could increase amid rising travel during the upcoming Labor Day holiday. On the other hand,there are still some concerns over an interest rate hike and that China`s demand could fall short of expectations.