02 July 2010 06:53 [Source: ICIS news]
By Becky Zhang
SINGAPORE (ICIS news)--Asian purified terephthalic acid (PTA) prices may lose further ground this month on weaker demand, due to production cutbacks at a major downstream market - China’s textile industry, market sources said on Friday.
PTA has a strong application in polyester production, with the textile industry consuming a huge portion of the global polyester fibre output.
Most textile producers had stocked up on raw materials in June, and may not be as active in the market this month, industry sources said.
Restocking of polyesters in June provided the weak PTA market some respite, with spot values edging up to $835-860/tonne (€668-688/tonne) CFR (cost and freight) CMP (?xml:namespace>
“We expect polyester demand to decrease in July after most textile factories [finished] stocking up enough raw materials in June,” the polyester maker.
Over the past three months, PTA prices had shed a total of $125/tonne or 13%, as general concerns about the eurozone debt crisis and falling crude prices gripped the petrochemicals market.
Expectations that crude prices have bottomed out triggered the restocking of polyesters, pushing inventory levels to 10-15 days against the normal one-week stock levels, market sources said.
“Textile plants had been purchasing polyester yarns actively in June as there was a need for them to replenish depleted inventory at the time when they sensed crude prices were about to bottom out,” said a Jiangsu-based polyester maker.
But polyester and textile production could be curtailed due to restrictions on electricity use of industries in
“The electricity savings scheme in
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