Asian MEG falls to a two-month low on 3% fall in Chinese PTA futures

16 February 2012 09:03  [Source: ICIS news]

SINGAPORE (ICIS)--Asia’s monoethylene glycol (MEG) prices have fallen to a two-month low after a 3% drop in China’s purified terephthalic acid (PTA) futures, market sources said on Thursday.

May PTA futures, the most actively traded contract on the Zhengzhou Commodity Exchange, closed at yuan (CNY) 8,852/tonne ($1,405/tonne) on Thursday, down by CNY274/tonne from the settlement price on 15 February because of worries over the eurozone debt crisis.

The offers of spot MEG fell to $1,065-1,070/tonne (€820-824/tonne) CFR (cost & freight) China Main Port (CMP) for March shipments, $20/tonne lower from 15 February, according to data from ICIS.

Deals for March-delivery cargoes were concluded at $1,070/tonne CFR CMP and $1,075/tonne CFR CMP for bonded warehouse parcels early in the day, while negotiations at $1,060-1,065/tonne CFR CMP are underway.

“The market is full of offers and this [has worsened the] bearish sentiment,” a major regional trader said.

China’s port inventory reached a historic high of over 750,000 tonnes with increased import volumes arriving from all over the world.

This is almost exceeding China’s maximum storage capacity of around 800,000 tonnes.

The current quantity is equivalent to the country’s monthly consumption, according to ICIS.

($1 = €0.77, $1 = CNY6.30)

By: Becky Zhang
+65 6780 4359

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