Asia PET markets move slightly higher as year-end approaches

After hovering around at almost two-year lows in the previous two weeks, Asia PET markets have posted slight gains this week, ChemOrbis data show. Although demand conditions have stayed sluggish mainly in China, the ongoing increase in feedstock costs have supported sellers’ firmer stance.

Cost-driven hikes by Chinese, South Korean sellers despite demand woes

Despite concerns related to the growing Covid-19 cases after the easing of zero-Covid policy, Chinese sellers have hiked local and export offers slightly this week by citing higher prices of PTA and MEG and their low inventories.

ChemOrbis data suggest that spot PX, PTA, and MEG prices increased by around 1-2% on the week to be quoted at $940/ton, $740/ton and $490/ton respectively, all on CFR China basis.

Commenting about the market sentiment, a seller said, “This week’s PET offers were supported by the cost side and lower inventories. Many market players are upbeat about their outlook for 2023 despite the rising Covid-19 cases across China as they think that the government will continue to ease Covid restrictions even as the country fights escalating infections.”

Export PET bottle prices out of China are assessed stable to $10/ton higher from the previous week at $890-920/ton FOB, cash. Within China’s domestic markets, PET bottle prices were assessed stable to CNY50/ton ($7/ton) up on the week at CNY6950-7000/ton ($883-889/ton excluding VAT) ex-warehouse, cash.

South Korean sellers follow Chinese suppliers’ step

Like export PET bottle offers from China, export PET bottle prices from South Korea are also assessed stable to $10/ton higher during the week at $940-950/ton FOB Busan. A major South Korean producer said, “As the rising Covid-19 infections across China’s major cities remains a concern for the region, we will continue monitoring the Covid situation there as well as feedstocks to have a clue on demand and our future pricing.”

Spillover impact felt in SE Asia PET markets

In Southeast Asia, import PET bottle followed a similar trend, with spot prices being assessed flat to $10/ton higher from last week at $910-970/ton CIF, cash.

What to expect in the near-term?

Expectations about the near future trend are mostly divided into two. Some players have an optimistic outlook, anticipating a short demand burst prior to Lunar New Year, as well as sustained support from

the cost side. While others have mostly stayed cautious even after the recent upturn, citing the uncertainty over the Covid situation in China and the possible impacts of it.