PET prices in Europe rally to more than two-year high on tightening supplies
Shortening supplies have paved the way for the unexpectedly large increases recently in the wake of the absence of JBF in Belgium along with the Lotte Chemical’s force majeure declaration on PET supplies from its Wilton facility in the UK. A source close to the company said that the force majeure declared in early August remains in place, although there were no official statements at the time of press.
As a result of the recent hikes in PET prices, according to ChemOrbis Price Wizard, PET prices in Northwest Europe and Italy stand at their highest levels since May 2015, hitting more than a two-year high on average.
A distributor from Switzerland confirmed that supply tightened further upon the most recent production outages in Europe. He added, “The higher euro/USD parity at 1.20 widens the gap between the import and local market, which pushes buyers to purchase relatively competitive import materials; however, this might change soon as higher levels within Europe will catch global suppliers’ attention.”
A PET producer in China also affirmed that they made good sales to Europe despite relatively slower trading in the export market due to the ongoing antidumping investigations imposed against Chinese PET in different countries including Indonesia, Japan and Canada. A producer source noted, “Demand from export markets is stable as weak demand from Japan and Indonesia has been offset by better buying interest from Europe.”
A distributor from France noted that the outlook will remain firm until October as prices are likely to sustain their upward momentum on the back of short supplies. Plus, the deep sea cargoes that buyers secured during August will not arrive before late September, he noted.
A converter from Germany noted, “The spot market is specifically shorter as demand is strong. We received August contract offers with increases of up to €80/ton from July, but we don’t think that we can push for discounts.”
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