- Signals of positive progress in US-China trade talks support PET prices
- China offers to the export market deemed too high
- Summer season could not lift demand significantly
Market players shared with SSESSMENTS on the market trend and condition of PET Bottle in China during June. At the beginning of the month, PET Bottle offers in China were reported to be in a downward trend compared to the end of May due to a huge decline in the futures market like in stock market, Dalian Commodity Exchange, and even crude oil market. Done deals were recorded below the initial level, at CNY6,900-7,000/ton ($1,005-1,019/ton) for small quantities. In the second week, local PET Bottle prices recorded decreases between CNY50-100/ton ($7.2-14.5/ton) compared to the week before, as PTA prices were also in a downward correction of CNY100/ton ($14.5/ton). However, other sources also opined that the decline was due to the weak response from buyers. Nevertheless, the trend was completely different in the third week until the end of the month as offers had increased by CNY150-300/ton ($22-43.6/ton), following a phone call between President Xi and President Trump who agreed to extend their meeting at the G20 Summit in Japan, signaling positive progress in US-China trade talks. The increment also supported by the higher crude oil, PTA and MEG futures prices.
In the export market, SSESSMENTS was told that a similar trend to the local market was seen in the first week of June, also with the same reasons. During the week, Chinese producers could not conclude deals in the export market. The second week of the month, prices were stable from the first week, with deals concluded in the low end of the price range. At the end of the month, export offers were following the uptrend of the local market but met resistance from buyers as it was considered too high.
Starting the month, PET Bottle demand in China local market was lukewarm. Market players told SSESSMENTS that the unclear market conditions have pushed buyers on the sidelines and buy small quantities only or on an as-needed basis. Until the end of the month, demand was still ongoing with only small improvements recorded despite the summer is supposed to be the peak season for PET in China. A similar situation also recorded in the export market as the offers were considered too high by buyers, especially at the end of the month, as PET Bottle offers from China kept firming. Compared to South East Asia and India local markets which prices had been rather stable, China offers were not workable.
As crude oil prices are still on the uptrend, China market players expect PET Bottle prices to keep increasing in the near term. It is supported by the results of the trade negotiations between China and the U.S during G20 summit, where the U.S agreed to halt further tariffs hike on Chinese goods, while China decided to start buying more American goods. Both countries also agreed to continue trade negotiations based on equality and mutual respect. This positive development in US-China trade war is expected to help recover the trade of crude oil, petrochemical products, and agricultural products between the two countries, SSESSMENTS was told.
Tags: Asia Pacific,China,English,MonthlySSESSMENTS,Northeast Asia,Polyethylene Terephthalate (PET) China PET prices,PET pricesJuly 1, 2019 3:05 PM