Chinese PET softened in Vietnam as cost pressure mounts

A major Chinese supplier decided to step back on import PET offers to Vietnam by $35/ton from last week to $1095/ton CIF, LC AS term. Weaker demand and plunging upstream costs are blamed for the reduction, sources said, with limited support for a rebound in the coming days.

In fact, MEG cost based on CFR China fell $105/ton compared to early December to $633/ton on 26 December 2018, the lowest level in this whole year. In the meantime, PTA is inching lower but remain pretty lucrative. 

A distributor, who normally having Indonesian PET offered to Vietnam reported the unavailability of cargoes this week due to the on-going holiday in Indonesia market. However, the source said, “Demand is very slow. Buyers are just waiting on the sideline for prices to drop further. The crude oil market is not too supportive this week.” 

The first quarter of the year is traditionally the slow season for PET bottle, especially after the Lunar New Year period. Sellers become less optimistic about January outlook at the moment.