China’s Sanfangxiang cuts PET output on high feedstock costs

19 October 2010 09:13  [Source: ICIS news]

DUBAI (ICIS)--China's Jiangsu Sanfangxiang Group has been operating its 1.2m tonne/year polyethylene terephthalate (PET) bottle chip plant at a reduced capacity of 80% since last week because of surging feedstock costs, a company source said on Tuesday.

“All seven bottle chip lines are currently running, but only at 80% of their nameplate capacities,” said the source.

“The [PET] spot market outlook is very uncertain now with producers being forced to hike offers on skyrocketing raw material prices, while buyers [were] putting up fierce resistance, adopting a wait-and-see position,” he said in Mandarin.

Values of feedstocks purified terephthalic acid (PTA) and monoethylene glycol (MEG) had been rising over the past three weeks.

Based on ICIS data, PTA was assessed at $1,035-1,065/tonne CFR (cost and freight) CMP (China Main Port) on 15 October, up about $132-145/tonne from three weeks ago, while MEG increased $155-165/tonne to around $960-975/tonne CFR CMP over the same period.

Meanwhile, PET bottle grade chips were at $1,330-1,350/tonne (€944-959/tonne) FOB (free on board) China as of last Friday, according to ICIS.

Other major PET producers in China include China Resources Packaging, Zhuhai Yuhua, Yizheng and Far Eastern Industry Shanghai.

($1 = €0.71)

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By: Yu Guo
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