October Asia PTA contract price settles $20/t lower

18 January 2008 09:49  [Source: ICIS news]

SINGAPORE (ICIS news)--The contract price for purified terephthalic (PTA) acid sold into China in October was settled $20/tonne lower retroactively, after more than two months of hard negotiations, buyers and sellers said on  Friday.

 

The settlement totalled $840/tonne CFR (cost and freight) China, down on September due mainly to oversupply.

 

“The negotiations were long and hard, customers basically insisted that with the oversupply in the market, contract prices should be highly favourable to them,” said a leading supplier with plants in various parts of Asia.

 

“We wanted to balance off the hikes in the price of another feedstock, MEG, which rose so much it became incredible,” said an end-user, with polyester facilities in Zhejiang in eastern China.

 

In October, monoethylene glycol (MEG) prices spiked from $1,350/tonne CFR China early month to $1,535/tonne CFR by the end of the month, squeezing margins of polyester producers.

 

The September price was $860/tonne CFR China. Since the market swung into serious overcapacity in 2006, the monthly contract price in China has been settled on a retroactive basis, usually two months after.

By: Salmon Aidan Lee
+65 6780 4359

< previous article(ICIS Chemical Business podcast November 2, 2009)

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