LatAm PET set for price battle - buyer

26 February 2008 22:09  [Source: ICIS news]

HOUSTON (ICIS news)--A price battle could start in the South American market for polyethylene terephthalate (PET), as producers attempt to preserve margins at a time of low demand, a Brazilian buyer said on Tuesday.

Suppliers in Brazil and Argentina could compromise at a price rollover for March, sources said. However, sustained high raw material costs are affecting already-squeezed margins, and they are lending support to talk of price hikes.

Buyers, however, remain intent on seeing domestic prices drop by $40-70/tonne, the same decline seen in Asian export offers in January.

The roughly 45-day transit and processing time required for South American purchases of Asian material means that mid January orders would start arriving in the first week of March.

This could lend impetus to lower prices in the southern cone. However, as Asian PET is once more showing signs of upward price pressure, that leverage is at risk, the Brazilian buyer said.

Asian PET prices were in a range of $1,300-1,350/tonne FOB (free on board) Asian ports in February.

Argentine and Brazilian PET prices were flat during February, at $1,800-1,870 DEL (delivered) Argentina and $1,800-1,863 DEL Brazil, according to global chemical market intelligence service ICIS pricing.

Suppliers in the region include Mossi & Ghisolfi and Grupo Alfa.

($1 = €0.67)

For more on PET in Latin America visit ICIS chemical intelligence

By: Landon Feller
+1 713 525 2653

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