Tag Archives | PTA

China’s cotton auction key pointer for global economy outlook

Cotton markets are poised for another testing month in April.  The outcome will also have potentially major implications for the polyester chain – and in turn for commodities markets more generally. The reason is that China has announced that its long-awaited cotton auction will take place in the second half of the month.  Cotton stocks […]

Continue Reading

China’s PTA market moves to self-sufficiency and exports

Credit conditions are tightening day by day in China.  Companies with good payment records over many years are seeing their borrowing limits cut back.  2016 is indeed proving to be the year that President Xi Jinping “takes the pain of restructuring”. At the same time, self-sufficiency has become a key strategy for many industries, in […]

Continue Reading

Further chaos ahead for cotton and polyester markets as China aims to release its cotton stocks

Cotton has been on a roller-coaster ride over the past decade – to record high prices and then partial collapse.  This was followed by China’s decision to build the world’s largest ever cotton inventory as part of its post-2009 stimulus programme, to protect cotton farmers. This inventory, being off the market, means cotton has been […]

Continue Reading

Outlook for the global aromatics industry – insights from senior executives at Amsterdam Conference

Aromatics markets often lead petrochemical markets, and provide good insight into economic trends.  This has certainly been true of PTA (terephthalic acid) and benzene over the past year. PTA demand into polyester and PET is dominated by Asia: benzene’s wide variety of uses means it is a good proxy for industrial production in Europe.  Recent developments have been […]

Continue Reading

Falling cotton/polyester prices create ‘deflation shock’ for consumers

Cotton prices appear to be collapsing again due to the surpluses created by central bank stimulus policies since 2009.  As the chart shows, these had initially caused prices to soar to levels not seen since the American Civil War: They reached 230c/lb in March 2011, nearly double the post-1982 peak of 117c/lb in May 1995 (blue […]

Continue Reading

China becomes major PVC, PTA exporter for first time in history

Be very careful what you wish for.  That is the key message coming out of close analysis of China’s latest trade data. Recent media reports were upbeat at news that China’s exports had increased, as it appeared to suggest Western demand was returning.  But it seems nothing could be further from the truth. One major concern is that part […]

Continue Reading

Cotton prices suffer worst crash in 55 years

Just as forecast in March, world cotton prices have crashed. Prices peaked at 97.35c/lb on 24 March, just 3 days after the post was published.  Since then, they have fallen by a third to 65c/lb.  They have now fallen for 11 straight weeks – the longest slump in 55 years, according to Bloomberg. There is no need to repeat […]

Continue Reading

China’s PTA, PVC exports jump as it moves to preserve jobs

To assume, as they say is “to make an ass out of u and me”.  That was certainly the case last week, when financial markets assumed that China’s slightly better PMI index was a sign that its domestic economy was stabilising.  They had temporarily forgotten the key message of February’s Research Note, namely that the government would aim to […]

Continue Reading

Cotton prices slip as US supply rises and China’s imports fall

It seems that cotton prices are about to return to normal levels again.  The blog’s detailed discussion of the issues last September highlighted how current Chinese government policies seemed doomed to fail, at enormous cost to the wider world.  It now looks as though China’s new leadership agrees with this conclusion. Since late 2008, the previous leadership’s […]

Continue Reading

Cotton reserves equal 3 pairs of jeans for every person in the world

Cotton will be one of the main case studies used by future historians to highlight the failure of post-Crisis policies from 2008 onwards.  It highlights all the key issues: Their tidal wave of liquidity took cotton prices, as the chart shows, to all-time record levels. They soared to a record monthly level of 230c/lb in March 2011, nearly double […]

Continue Reading