PTA prices weakened marginally during the second fortnight of March. The downfall in crude oil and petrochemical feedstock prices has weakened the market sentiments of PTA. Therefore, cost support has eased and dwindling demand from the downstream polyester sector has kept PTA prices under pressure. The inventory of polyester products is growing and this would mean that traded volume of PTA may decline in the short term as buying would be less. On the other hand, supply of PTA is adequate and inventory level is normal. However, few large capacity plants are due for maintenance shutdowns in April which might create supply concerns. Current spot market offer prices for PTA are around US$ 670-675 per metric ton CFR CMP but buying prices are around US$ 645-650 per metric ton. Outlook for PTA prices indicate a fluctuating price trend in the coming fortnight.
MEG prices witnessed a firm trend during March second half after the declining trend that started in January end. Prices of the commodity looked up even though crude oil prices witnessed sudden drop in the fortnight and now hovering around US$ 50 a barrel. The primary reason for the upward trend is lower inventory and few plant shutdowns. Also, buyers have started procuring MEG as prices have come down from its peak. However, downstream polyester sector is not performing well and inventory level is growing. So, if the polyester demand does not pick up, the uptrend in MEG prices would not last long as petrochemical prices have lost cost support due to weaker crude oil prices. Current spot offer prices of MEG are around US$ 820-830 per MT CFR China and traded prices are around US$ 820 per metric ton. MEG prices are expected to exhibit a fluctuating trend in the coming weeks.
PET chips market prices witnessed marginal downward correction as crude oil prices declined this fortnight. The demand for PET chips is passable while inventory levels are normal. As the seasonal demand phase has arrived, though buyers are in a wait and watch mood, buying volumes might improve in the coming fortnight. Current Water Bottle Grade PET chips offer prices are around US$ 960-980 per MT FOB China while deals were done around US$ 960-970 per MT FOB China. Fibre grade chips quoted prices are around US$ 950-960 per MT FOB Korea. Chips prices are expected to move in line with raw material prices in the coming weeks.
PSF prices witnessed a stable price trend during the second fortnight of March. However, decline in the PTA prices have eased the cost pressure on fibre suppliers. Also, inventory level of PSF has grown due to weaker traded volume in the last fortnight. Since the demand for the fibre has not picked up, there is pressure on fibre suppliers who have reduced fibre prices in domestic markets (though export offers remained unchanged). Yarn spinners are asking for better fibre prices as spun yarn sector is not performing well due to weaker demand. Therefore, traded volume of PSF has been affected and fibre suppliers have reduced prices in their respective domestic markets. In Chinese local markets, trading activities for PSF were extremely low and price cuts have been substantial. In Indian local markets, PSF prices have been slashed by most of the leading suppliers to boost traded volume but not much improvement was observed. Current offered price for 1.4 denier raw white semi dull PSF is around US$ 1.03 – 1.05 FOB China/Taiwan. CNF India prices are around US$ 1.06 – 1.09 per kg.
Prices of PSF are expected to witness some correction in the coming weeks.
Polyester Filament Yarn prices witnessed marginal downward correction during the second half of March. The correction in the PTA price helped bringing down yarn prices but MEG has exhibited an increasing price trend which may stall further price corrections. However, the demand for polyester filament yarn has not been healthy and inventory levels are building up. As cost support has eased with the decline in PTA prices, filament yarn prices might witness a fluctuating trend. In the last fortnight, price correction was prominent in POY and FDY while DTY prices remain more or less stable. Prices in Chinese local markets have come down while a similar scenario was witnessed in India. Current quoted price for 115D/36F POY is US$ 1.04-1.05/kg FOB China/Taiwan, 150D/48F POY price is US$ 0.96-0.98/kg FOB, whereas 75D/36F DTY price is US$ 1.46-1.48/kg and 75D/72F FDY price is US$ 1.11 – 1.12/kg FOB China/Taiwan. PFY market forecast indicates that yarn prices would be governed by raw material price movements and may witness declining trend in the coming weeks.