Supply woes gain prominence in Europe’s PET market

In Europe, hikes of up to €70-80/ton are passing on October PET deals amid tightening availability, pushing spot prices on the high end close to the €1300/ton FD level. Several producers have reportedly sold out their monthly allocations, while some suppliers even claimed to sell out until the end of the year.

Maintenance shutdowns and higher exports to the US and South America led to reduced availability across the region. Plus, import supplies shrank as a result of challenging logistics operations. A distributor said, “There are limited import offers as our regular overseas suppliers are not offering for the time being. We think that they wait for China to be fully back in harness before they decide on their fresh pricing policies.”

Autumn turnarounds underway

Turnarounds at two regional PET plants are underway. JBF-RAK and Equipolymers were planning to shut their plants between September and November.

In upstream markets, PTA supplies are also known to be tight. Indorama Ventures postponed its PTA shutdown to November in Rotterdam, the Netherlands. The company also plans to conduct a planned maintenance at its PTA lines by the first quarter of 2022.

Eyes on buyers’ restocking needs

Sellers reported that it will be more challenging for buyers to find material in the following months. Buyers’ stocks may not last longer, as a trader put it. A recycler said, “We are covered until mid-November but we will need to purchase later despite higher prices. Our intention was to reduce purchasing volumes due to unattractive price levels. Yet, supplies may tighten further as several producers are reportedly sold out.”

It remains to be seen whether or not there will be many buyers feeling an urge to replenish their stocks amid low season.

Nov calls for further hikes

Prices are mostly expected to post further hikes in November, mainly supported by supply woes and rising crude oil and feedstock prices. A participant opined, “Spot prices may hit €1350/ton FD on average next month.”

2022 contract negotiations are trending upwards amid comments that there will be a significant increase.