Polyester fibre prices sluggish. Is it a signal of moderation?
Polyester fibre prices were seen falling in China at the close of May while they were hiked in Pakistan and flat in India. Analysing the behavior of upstream – MEG, PTA and chip, markets, is appear that the buying appetite of polyester makers for raw materials was not great. Reports also indicated that the polyester market is entering off season phase soon.
[These are excerpts from Textile Beacon’s “Global Markets Weekly Review” of 4 May. The review is prepared by an author with long experience and expertise in global market intelligence]
During the last week of May, polyester fibre was traded at discounts in China opening the week as trading was thin. Later they were dragged down by falling raw material and crude oil prices. Prices kept the downward streak and stabilised in general towards the weekend as PSF makers saw sound liquidity. In Jiangsu and Zhejiang, offers for 1.4D direct-melt PSF fell US cents 2 a kg, while the same in Fujian and Shandong were cheaper by US cents 1-4 a kg.
In Pakistan, producers hiked their offers for June citing recent rise in cost of PTA and MEG in global markets. Nevertheless, a moderation in cost may prompt producers to reset their offers soon. In India, producers’ offers remained unchanged given the flat run in the raw material cost in recent weeks. However, strong INR pegged values up in US$ terms ending May.
http://www.textilebeacon.com/news/manmade-fibre-prices-stable-firm-cost/
Upstream, mono ethylene glycol markets were under pressure in Asia on losses in crude oil prices and slower downstream sales. Although the discussions were in a narrow range, trading activities were limited because of lack of buying appetite. Demand from the downstream polyester textile also slowed down slightly after the fall in crude oil price. Most buyers were cautious on buying though they did not expect major price movement due to relatively balanced demand-supply conditions. MEG spot prices declined US$19-20 week on week. In China, Sinopec decreased its list prices for June MEG by US$109 a ton, citing a weak spot market.
Purified terephthalic acid prices remained stable in Asia after rising on tight supply in recent past, despite weak demand. Upstream paraxylene markets were also subdued easing cost pressure on PTA makers. The CFR China PTA markers almost rolled over in the last week.
Polyester chip prices continued to trend down on the back ample supply amid weakening demand. Demand was weak as chip-based spinning mills activity slowed down with the approach of off season and only did need based procurement. Semi dull and super bright chip markets saw suppliers cutting offers due to thinning trade.
