Early April 2024, Asian and European PET Prices contrast with US PET Prices

During the initial days of April, the global Polyethylene Terephthalate (PET) resin market displayed a varied sentiment, with both the Asia-Pacific and European markets mirroring similar trends. Conversely, the US market maintained a stable stance. The trend of PET prices was influenced by downstream demand and the fluctuating crude oil prices amid geopolitical concerns.

In the United States, the PET market maintained its steady course, a trend that took root in late March. This stability followed a notable increase in the third week of March, which was subsequently balanced by a 2.3% decline in the feedstock Mono Ethylene Glycol (MEG) prices. With ample inventory in MEG feedstock, Ethylene Oxide, and moderate demand from downstream industries, particularly the PET bottle and packaging sector, prices found equilibrium. Despite a 4% rise in Crude Oil prices, the impact on MEG prices remained minimal, thanks to modest fluctuations in crude oil inventories. The overall scenario in the US, including refinery operations at more than 88% capacity and a slight decrease in daily crude oil imports, influenced the commercial crude oil storage dynamics. Moreover, a marginal rise in inflation signalled potential challenges ahead, primarily driven by higher oil and raw material prices and increased transportation rates observed in March.

Across Asia-Pacific region, PET markets exhibited a bullish inclination, especially in China. PET prices increased by approximately 0.9% during the initial week of April driven by an upward trend in raw material prices, particularly Purified Terephthalic Acid (PTA), which saw a week-on-week increase of approximately 2.5% during the same period. Despite slight fluctuations in upstream ethylene glycol prices and stable crude oil support, MEG prices remained subdued. The robust demand from downstream industries, coupled with cautious price chasing mentality, contributed to a favourable production and sales environment.

In Europe, the PET prices experienced modest increases in raw material prices during March 2024. In Germany, PET feedstock prices, including MEG and PTA, witnessed notable upticks, influenced by bullish sentiment in crude markets. External factors, such as a drone attack on a major Russian oil refinery and escalating tensions in the Middle East, fuelled the bullish sentiment, consequently impacting downstream petrochemical prices. While this surge in raw material costs potentially constrained margin recovery for European PET resin producers, downstream customers maintained a conservative stance on demand, anticipating possible price fluctuations in the coming months. Despite the challenges, domestic producers saw partial margin recovery since January 2024, leading to the restart of production lines and robust sales in March.

In conclusion, analysts predict that the global PET price trend is likely to continue its upward trajectory, particularly throughout the month, driven by the instability in crude oil prices amid escalating geopolitical tensions, which could lead to higher feedstock prices. Additionally, during the summer, downstream procurement may respond strategically to these market dynamics.