13 January 2012 23:59 [Source: ICIS news]
LONDON (ICIS)--The price of European polyethylene terephthalate (PET) is increasing because of hikes in raw materials and limited availability in Europe, sources said on Friday.
“We are talking over €1,300/tonne [for January] because with the cost of raw materials the PET price needs to start with the €1,300s/tonne...February depends on raw materials but i expect producers will ask for €50/tonne on top of raw materials,” a producer said.
Producers have primed their customers for a January increase in line with and often beyond the increase in feedstocks paraxylene (PX) which feeds into purified terephthalic acid (PTA), and PET’s secondary feedstock, monoethylene glycol (MEG).
“In January we are definitely going to improve margins to be sure we are not below Asian imports,” a second producer said.
PET buyers and sellers expect to see further firming in February because with exchange rates and the Lunar new year, imports are thin on the ground and European producers’ stocks are low.
“European producers are committed to getting increases and there is nowhere else to go because there are no imports,” a customer commented.
Weekly domestic prices are already experiencing an increase and €1,250-1,300/tonne ($1,575-1,638/tonne) FD (free delivered) Europe is considered applicable for this week, according to data from ICIS.
Offers are higher, often reaching €1,350/tonne, depending on size of account and on the starting point. Occasional sales above this are beginning to come through.
Some customers are ready to accept €50/tonne over their last price, but are unsure about moving higher. Others have bought product at an increase to December and report that offers below €1,300/tonne have now disappeared. Buyers and sellers confirm that prices have moved up since the beginning of January.
“We will pay higher prices and we have to buy,” a second customer surmised.
($1 = €0.78)
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