A source from a Chinese PET producer mentioned that firmer monomer prices coupled with better demand in the China market have served as a toehold for local and export PET prices to move higher. This week, SSESSMENTS.COM was told that the Chinese PET producer decided to adjust up their offers by CNY200/ton ($28/ton) to the local market and by $20/ton to export market, all on a weekly comparison. The decision was made following PTA and MEG prices that increased between CNY200-300/ton ($28-42/ton) over the week as supported by the rebound in crude oil prices. However, the PTA and MEG prices were recently becoming less affected by the increase in crude oil prices due to high availability. The trader cited that the main reason behind heaps of stocks for PTA and MEG is because of the lesser demand for finished PET fiber goods (clothes) from the export market amid the Coronavirus outbreak.
Besides monomers prices, the source stated to SSESSMENTS.COM that demand has also taken a role in supporting prices. This week, domestic demand for PET Bottle is quite good due to warmer weather in China. Speaking of the export market, as of May 20, South Africa has announced its anti-dumping duty policy on Chinese PET Bottle resins but Jiangsu Sanfangxiang International Trade Co., Ltd. is excluded from the list. According to the source, the annual demand for PET Bottle in South Africa was recorded about 300,000 tons with the imported volume from China is approximately 70,000-80,000 tons. However, even when Chinese producers are losing market share in South Africa; the producers are still able to explore other export markets.
In the days to come, the producer’s source believes that the inventory of PTA and MEG would not be digested immediately. Therefore, the room for PET prices to move higher is rather small, even when the crude oil prices continue to soar. On the other hand, considering the good demand in the local market, the outlook for PET market is not too pessimistic either, the source voiced out to SSESSMENTS.COM.
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