Low Demand On End-Product Sector Affected Overall Southeast Asia PET Market
- Local PET Bottle offers in Malaysia moved in tandem with import
- Demand for end-product not yet recovering
- Pricing outlook would be positive for the time being
Downstream industries reported that demand for their products is still weak, causing absorption and demand for PET resins not yet recover. Converters reported to SSESSMENTS.COM that local PET Bottle offers in Malaysia recorded an increase of between MYR30-100/ton ($7-23/ton) from last week, stood at MYR3,180/ton ($746/ton) on cash, FD basis and excluding 6% SST. Meanwhile, local PET Bottle offers in Thailand maintained stable from last week at THB24,000/ton ($773/ton) on cash, FD basis and excluding 7% VAT. Traders in Malaysia revealed that the local producer raised offers following the uptrend on import Chinese PET Bottle offers, which rose by $10/ton on the high-end level of the price range available last week. Regarding acceptance level, buy ideas from Malaysian buyers for import Chinese PET Bottle cargoes captured at $10-30/ton lower from the offers available in the market this week.
Low demand for PET resin still recorded in Southeast Asia this week. Although most of the Malaysian converters are running at full capacity, some choose to adjust their production rate to match the demand for the end-products. Some converters are having a hard time to deal with cash flow issues as their businesses had been hit hard by the pandemic. In Thailand, the monsoon season was cited as the main factor affecting the demand for PET Bottle in the country. Additionally, Southeast Asian buyers were showing limited interest in import cargoes recently. On the supply front, no significant issues were reported by Southeast Asian PET market players to SSESSMENTS.COM.
In the days to come, the firm crude oil price is expected to support PET Bottle prices to remain stable or even firmer. While some countries have eased lockdown restrictions and allow industries to resume operations, market players are still having trouble seeing the development of end-product demand, sources told SSESSMENTS.COM.
