Chinese PET continue inching lower in Indonesia, soft outlook ahead

Major Chinese producers reportedly stepped back on import PET bottle offers to Indonesia by $10-20/ton week on week amid diminishing demand condition. Latest offers stand at $1350-1360/ton FOB China, LC AS term with limited transactions observed throughout the week. Buyers here are expecting the current trend to persist in the coming week, believing that supply is improving.

“In the meantime, we are in no hurry to slash prices to steep at the moment as we have oversold cargoes for July and August shipping. Quarter 3 is usually the low demand season in Asia, however, we hope to see a better condition in the medium term,” a Chinese producer informed.

Another trader offering Chinese PET at $1360/ton CIF Indonesia, LC AS term added, “It is very difficult to attract deals for Chinese cargoes in Indonesia as the anti-dumping investigation remain inconclusive. Buyers are concern over unexpected duty rates and implementation rate. We have been focusing on other export outlets for months.” 

Looking at the supply side, Far Eastern Petrochemicals Vietnam is set to bring its newly constructed PET bottle plant in Vietnam on-stream by end of July. The unit is designed to produce 400,000 tons/year.

On the other hand, China’s Jiangsu Xingye (SFX) started the trial run at its new 500,000 tons/year PET plant in China earlier this week. The company is expected to achieve on-spec cargoes by end of June 2018. 

With new supply coming in the soft demand season, buyers are taking a more cautious stance over fresh purchases. “Market might not return to below $1000/ton threshold, however, we do expect to see a moderate reduction in the coming month,” a converter said while adding that end product orders for the new month remains disappointed.