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Turkey’s PET markets extend drops into April, pervaded by weak demand

by Merve Madakbaşı - mmadakbasi@chemorbis.com
  • 09/04/2021 (09:25)
Import and local PET prices in Turkey have followed a downtrend since H2 March. The gradual cuts were led by waning activity following bulky purchases during the run-up in February. Although supplies are not comfortable and complaints about PTA tightness prevail, the weakness has remained intact both for bottle and textile grades as of early April.

Lower feedstock prices including for PTA, PX, and MEG in Asia have also contributed to the weakening trend for downstream PET, as can be seen from ChemOrbis Product Snapshot below.

*Right click the image and open in a new tab to view the full-sized snapshot.

PET Prices – Turkey – CIF – Bottle Grade – Textile Chips

Import PET bottle prices declined 9% in a month

Import PET bottle offers on CIF Turkey basis have lost $120/ton (9%) in total over the past four weeks, the weekly average data from ChemOrbis revealed. Lackluster activity has mitigated the impact of limited import volumes and logistic hurdles.

Lower export offers out of China, which broke below the $1000/ton FOB threshold on the low end this week, are paving the way for additional weakening in prices. Chinese offers were assessed $10/ton lower from last week at $1170-1180/ton CIF Turkey amid thin price discussions between buyers and sellers. Prices already broke below $1200/ton in late March.

Following suit, import Malaysian PET bottle offers retreated by $40-50/ton week over week to break below the $1200/ton CIF Turkey threshold.

Pre-Ramadan demand disappointing for bottle grade

Demand from the beverage and food packaging sectors showed no pick up ahead of the imminent start of Ramadan, several players confirmed. A manufacturer noted, “Demand should have picked up one month ahead of Ramadan, before waning during the holy month. However, we have not realized a recovery so far.”

Plus, there have been no extensive seasonal preparations ahead of the high bottle season. This is because converters sit on comfortable stocks and hesitate to engage in fresh purchases owing to their lack of confidence in the demand outlook. “Uncertainties amid tightening coronavirus measures are also weighing on buying sentiment,” a participant said.

Sluggishness outweighed modest import volumes for PET textile

Asian PET textile chips prices have plunged 90$ (7%) in cumulative from a month ago since most buyers opted to reduce their purchasing activity, the weekly average data from ChemOrbis Price Index suggested.

Manufacturers paid abrupt increases during February and part of March when astronomic PP resin hikes buoyed polyester demand and a logistic turmoil caused supply cutbacks.

However, demand support started to fade in stages starting from March in response to volatile USD/Lira parity, volatile energy complex, and uncertainties related to the third wave of COVID-19 outbreak.

Turkish converters mostly meet their requirements from the local market as they find it risky to engage in distant cargoes amid expectations for further softening ahead of the Ramadan lull.

Asian import PET textile chips prices were assessed $20/ton lower on the low end at $1140-1180/ton CIF Turkey, cash this week. POY (Partially Oriented Yarn) offers for 300-500 D (denier) were down by $10/ton week over week at $1370-1430/ton CIF, cash.

“Malaysian offers have re-emerged after a long time which may be interpreted as a sign of stalling demand in Asia,” commented a player. Fears of a possible lockdown in India amid soaring infections may dim the outlook for polyester further in the coming term.
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