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Asian PTA prices hit a 16-month low, polyester losing cost support

YarnsandFibers News Bureau 2013-11-27 12:32:00 – Mumbai

Asian purified terephthalic acid prices fell in week ended 22 November, dragged down by a bearish polyester market amid high operating rates of PTA plants in China. Prices hit a 16-month low on rising supply and weak demand. European PTA producers expressed unhappiness over the initial contract price settlement for feedstock paraxylene. Meanwhile, November US terephthalic acid prices are expected to move down after contracts for feedstock paraxylene was settled lower in the week. Asian PTA markers fell US$9 with the CFR China assessed at US$983-988 a ton and South East Asian numbers at US$989-996 a ton. However, US spot paraxylene rose despite quieter demand with no firm deals heard done. European spot paraxylene remained unchanged amid lack of bids and offers. Asian paraxylene prices declined on ample supply in Southeast Asia. The other polyester feedstock, ethylene prices were stable in Asia on thin discussion. European ethylene market was stable to lower as inland prices remained flat despite rising naphtha costs which were counterbalanced by slow derivative segments. Coastal goods were also flat. In US, spot ethylene prices declined, receding from the 12-week high, dragged by weaker buying interest. Despite softening of ethylene in US, MEG prices continued to remain at high levels to be competitive in the export markets. European MEG prices fell to 2013 low, marked by bearish demand which continued to put pressure on prices. MEG prices in Asia also dipped amid lackluster demand. The trend forward is also likely to be softer as Shell nominated December MEG Asian Contract Price down US$15 from November. Polyester chip markets reached an impasse and trading was quiet in Asia. Mainstream offers opened last week on a firm note, with sporadic ones hiked marginally due to low inventory. Polyester filament yarn markets held stable and offers were largely maintained by producers, except for select revisions. In Pakistan, DTY offers were flat, with trading volume marginally lower. Indian PFY market was weak and producers were keen to offload inventory. Polyester staple fiber markets were on a weak correction with prices slightly down, both in China and India. There was limited cost support due to sliding polyester intermediates. In China, PSF prices were relatively stable with 1.4D direct-melt-spun PSF pegged at US$1.58-1.60 a kg, down US cent 1 from previous week. In Pakistan, prices in Karachi were stable at US$1.66-1.70 a kg while Indian PSF prices were revised down to US$1.63 per kg

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