24 October 2012 17:51 [Source: ICIS news]
LONDON (ICIS)--A November rollover for polyethylene terephthalate (PET) prices in Europe is unlikely because demand is weak, so producers' efforts to roll prices over from October will fail, customers said on Wednesday.
"No doubt the [PET] market will go down in November and December. Demand is really poor despite European producers shutting down," a buyer said, echoing comments made by other sources.
Following a spate of price increases, which began in July when prices bottomed out at €1,130/tonne ($1,468/tonne) FD (free delivered) Europe, the freely negotiated market peaked at €1,300/tonne in September. It has since been hovering between €1,250-1,300/tonne, according to ICIS data.
"Realistic spot prices for November are €1,220-1,240/tonne," a second buyer said, adding that the demand/supply dynamic would result in these lower prices next month.
Buyers reported deals at €1,230-1,260/tonne for product delivered in October/November.
The freely negotiated transactions performed for October delivery have resulted in producers failing to make margins.
"PET producers cannot afford to lower prices," a third buyer said, citing high raw material costs versus limited demand.
Feedstocks paraxylene (PX) and monoethylene glycol (MEG) contract prices have been on the rise since July. October MEG increased by a further €20/tonne to €1,095/tonne FD northwest Europe (NWE) and October PX rolled over at €1,190/tonne.
($1 = €0.77)
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