Polyester takes breather as the march slows early September

Polyester staple fibre markets in Asian remained supported by higher feedstock cost despite seasonal lull in demand. Prices in China local markets inched up while export offers remained unchanged in the week ended 7 September, due to lack of buying appetite. In Pakistan, PSF makers hiked offers on firm PTA cost but trading sentiment was tepid. In India, PSF market was stable and discussions generally remained unchanged.

Polyester yarn offers in China were kept firm as upstream raw material and feedstock markets were sluggish during the week. However better demand for finer 60s yarn further pushed up prices. Rise in PSF prices in Pakistan supported polyester yarn prices to remain stable while stable PSF helped yarn markets in India.

Polyester filament prices did not move in China despite raw material cost kept rising. In Jiangsu, following the fluctuation of upstream feedstock, local PFY offers were generally stable. In Pakistan, following the fall in currency, prices for imported goods were raised, amid mixed buying mood. In India, PFY markets were insipid and major producers rolled over their offers.

Upstream, the price run in purified terephthalic acid (PTA) market was halted in Asia as paraxylene prices retreated sharply and participants awaited result of public hearing about the tariff amid China-US trade war. In China, domestic PTA prices changed marginally and few discussions were for spot goods to be delivered by end September. In Europe, no major development was reported from PTA markets and prices rolled over. In US, August contract prices were assessed higher, tracking increase in paraxylene contract.

Paraxylene, used to produce PTA, saw prices receding in Asia although markets were supported by healthy fundamentals. PTA prices also remained flat. In Europe, paraxylene sentiment was bullish but tracking Asia spot prices tumbled in the region. In US, August paraxylene  contract prices jumped amid surging spot prices.

Mono ethylene glycol (MEG) prices rose above US$1,000 a ton mark early in the week in Asia but retreated significantly later as futures saw limit down at weekend. Sentiment were increasingly bullish ahead of the polyester peak period in September and October and offers rose along with higher Chinese domestic prices. In Europe, August MEG contract was confirmed down from July.

Meanwhile, ethylene prices continued to fall hitting a 16-week low in Asia on healthy supply from regional and non-regional producers. In Europe, spot prices were under downwards pressure as supply length was building ahead of the start of the autumn cracker planned turnarounds. Domestic spot activity was very thin during the week. In US, ethylene spot prices rose sharply to reach a six-month high as upstream ethane costs spiked. August contract prices settled at an increase from July.