China polyesters fall 3% on stock liquidation

04 July 2007 07:35  [Source: ICIS news]

SINGAPORE (ICIS news)--Polyester fibres and yarn prices in China dropped by as much as 3% last week on the back of some speculative sellers’ liquidation activities in eastern China, producers said on Tuesday.

In an attempt to generate cash flow, eastern China sellers slashed their offers by as much as CNY400/tonne ($52.70/tonne), or 3%, on Friday, hoping to liquidate polyester stocks in order to purchase feedstocks purified terephthalic acid (PTA) and monoethylene glycol (MEG).

This practice was replicated throughout China by other polyester producers which reduced their prices by as much as CNY200/tonne over the weekend.

Despite this, buying activity on the polyester front was weak as consumers interpreted it as a sign of even larger discounts to come.

Fabric transaction volumes for polyester filament yarn producers at the “China Textile City” in Shaoxing reflected the market trends with 7m-8m metres per day, down by almost 10% from last week’s transaction volume of 8m-9m metres per day.

Overall polyester production was estimated around 80%.

Domestic prices of partially oriented yarn (POY) 150 decreased by CNY300/tonne for the week to 3 July from last week’s level of CNY12,400-12,500/tonne, according to global chemical market intelligence service ICIS pricing.

Chinese export prices were also impacted with drawn texturised yarn (DTY) 150 prices softening by 12 cents per kg free on board (FOB) northeast (NE) Asia from last week’s level of $1.68-1.72/kg FOB NE Asia.

($1 = CNY7.59)

By: Hong Chou Hui
+65 6780 4359

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