PET suppliers lifted offers to Southeast Asia on cost-push

The fibre stream in Asia halted the long stretch of the downtrend that takes place since early September this year thanks to the positive effect of the trade talks between China and USA over the previous weekend and stronger energy complex.

MEG costs based on CFR China term jumped nearly $60/ton, shrugged off the plunge in the upstream ethylene market while PTA holds steadfast with demand from the polyester sector picks up significantly, sources said.  

Downstream PET bottle market responds rather swiftly to the development at the upstream and many producers, especially Chinese maker, decided to implement $20-30/ton increased on the latest prices compared to the beginning of the week.

“We purchased some Chinese material earlier this week at $1060/ton CIF Vietnam and the supplier lift the offers by $20/ton today. The market is moving rather quickly,” a Vietnamese converter reported.

An international trader opens new offers for Chinese cargoes at $1110/ton FOB China, LC AS term to Indonesian buyer, up $20/ton from last Friday added, “Buyers are not responding very positively to the new offers. However, we think the market has hit the bottom.” 

The aggressive stance from suppliers is raising questions among Southeast Asian buyers, who doubt the sustainability of the current trend. This is because the traditional peak season for PET bottle might soon end as preparation for the festive season might only stretch for another couple of weeks while the restart at several Chinese PET plants might bring more supply to the market.

“We have comfortable inventories for the remaining days of the year and only look to build some stock for January. Domestic producers are very firm and therefore, we are looking for competitive materials from import ground,” an Indonesian buyer purchased Chinese PET at $1030/ton CIF, LC AS at the beginning of the week added.