US Nov PET prices drop 7.2% on upstream declines, slow demand

NEW YORK (ICIS)–US polyethylene terephthalate (PET) monthly negotiated domestic prices for November dropped by 7.2% on average from October values because of steep declines in feedstock purified terephthalic acid (acid) and paraxylene (PX) November prices, market sources said on Thursday.

The November PET price range was assessed at 78.25-83.25 cents/lb stretch blow moulding (SBM) DEL (delivered), down from 84.50-89.50 cents/lb SBM DEL in October.

The average 6.25 cents/lb drop was based on November price settlements done in a range of 5.5-7.0 cents/lb decreases, depending on the account, according to input from market players.

The November contract price for upstream PX was settled down by 15% to 52.00 cents/lb DEL from October on the back of continued weak values in Asia PX spot prices.

The PX decline resulted in a 12% decrease to 48.04 cents/lb DEL in the November contract price for downstream PTA, the key feedstock for PET. PTA contracts are not freely negotiated and are formula-dependent on the PX price delta.

Meanwhile, low demand for PET bottle resin also weighed down prices as PET is in its off season in autumn and winter when consumption of bottled water drops. In addition, buyers are not purchasing material to keep inventories low, as they typically do at the end of the year for tax purposes.

The primary PET downstream application in the US is in clear plastic beverage bottles. PET, as polyester, is used in textiles, which is a smaller market for PET in the US.

Major PET producers in the US include DAK Americas, Indorama, Mossi & Ghisolfi (M&G) and Nan Ya Plastics.