Re-PET prices decline generally and may sustain weak

Since early Apr, polyester product prices have been weak overall, and PTA prices continued to step lower. Prices of PET bottle chip, PET fiber chip, PSF and PFY all moved downward largely, with a decrement of 300-500yuan/mt generally.

With continual weakening of virgin polyester prices and sluggish downstream demand, recycled chemical fiber sales were bleak and inventory piled up. In early May, some recycled PSF plants shut down for one week and half a month, partly longer for one month. Under high costs and low selling prices, recycled chemical fiber producers had weak production enthusiasm, and production cut can reduce losses. Therefore, recycled chemical fiber plants lowered the purchase prices of PET flakes.

Recently, many cleaning plants adjust lower the bottle bale purchase prices in Guangdong, Fujian, Jiangsu, Hubei and Hebei, down by 200-300yuan/mt generally. Rough bottles prices also slip. PET flakes prices step down correspondingly. Under such condition, bottle bales and PET flakes suppliers show higher selling interests. Currently, cold washed blue and white flakes are offered at 5,200yuan/mt pre-tax in Zhejiang and Jiangsu, and supply increases apparently, and hot washed blue and white flakes are partly traded at 5,900-5,950yuan/mt.

For late market, temperature has increased apparently, and sources are into the market gradually after May Day holiday. Supply is expected to increase slowly. While recently, recycled chemical fiber demand is weak and the tight supply situation eases somewhat. For recycled chemical fiber, under the background of weak demand, re-PSF prices keep down, and cash flow is poor. Re-PFY and re-PET chip is at a low cash flow or at losses, hard to support PET flakes prices. For the demand from sheets, as PET bottle chip and PET fiber chip prices decline apparently, the PET flakes for sheets see lower price advantages, and lack certain support as well.