PET retains bullish path in China
Aug. 31, 2018
In China, the PET market posted a fresh round of increases last week despite the approaching end of the high season. Suppliers, who elected to maintain their firm stance on PET, pointed to rallying PTA prices in Asia.
Overall export PET prices were quoted at $1290-1360/ton FOB China, cash. The range was up by $10/ton on the low end and by $30/ton on the high end when compared to the previous week. A producer lifted its export offers further by $30/ton from a week earlier, with a producer source saying, “PTA and MEG prices have gained further ground, supporting a firming trend for PET. Buyers remain cautious and continue to limit their purchases according to their urgent needs as the low season is approaching. However, we think that PET prices may have room for further increases if the upstream markets sustain their bullish run in the near term.” Another producer sharply raised its export offers by $70/ton on the week.
Inside China, the overall range for local PET prices witnessed fresh gains of $70-85/ton from a week earlier. A domestic producer applied a notable increase of CNY500/ton ($73/ton) on its PET offers to the local market while another producer’s prices jumped CNY1300/ton ($191/ton) from the previous week. In addition to strong upstream costs, players attributed rallying local offers also to the depreciation of the yuan against the US dollar.
Following the previous week’s sharp increases, some players believe that PET bottle prices may hover around their current levels in the near term. However, suppliers might increase their offers further if the upstream markets continue to gain ground. In feedstock markets, spot PTA and spot MEG prices on CFR China basis increased by around $30/ton on a weekly basis to be respectively quoted at $990/ton and at $940/ton as of the end of last week.