Global PET Prices Decline in First Half of September 2024 Amid Weak Demand
Global PET Prices Decline in First Half of September 2024 Amid Weak Demand

Global PET Prices Decline in First Half of September 2024 Amid Weak Demand

  • 25-Sep-2024 4:17 PM
  • Journalist: Rene Swann

In the first half of September 2024, the global Polyethylene Terephthalate (PET) market experienced a notable downward trend. This was primarily due to lower crude oil prices, which directly affected the cost of raw materials used in PET resin production. Declining feedstock prices and weak demand further exacerbated the situation.

In the United States, PET prices dropped significantly due to weak downstream demand and an oversupply from some plant restarts. By the week ending September 20th, PET resin prices had declined by 2.5%, primarily influenced by falling raw material costs. Feedstock Mono Ethylene Glycol (MEG) prices dropped by around 2%, and Purified Terephthalic Acid (PTA) prices decreased by approximately 3%. Lower crude oil and propylene prices also contributed to reduced production costs. Although supply tightness had previously arisen from hurricanes, increased inventory levels and improved container availability helped ease the market. As a result, a bearish trend in the PET market took hold, with low shipping rates further supporting this decline. Container shipping costs from Asia to the U.S. dropped again, although concerns about potential delays loomed as carriers halted export bookings from U.S. Gulf and East Coast ports in anticipation of a possible strike. This potential work stoppage could exacerbate congestion.

In Germany, the trend mirrored that of the U.S., with PET prices falling by around 1%. The decline was largely due to lower production costs and moderate buying activity. Feedstock prices, particularly PTA, fell by 6.3%, driven by oversupply from plant restarts.

In the Asia-Pacific (APAC) region, particularly in China, the PET market saw a slight downward trend initially, influenced by raw material prices. However, a subsequent surge in crude oil prices and unexpected facility shutdowns caused by typhoons tightened the local supply. This led to the disappearance of low-priced goods and an upward shift in market prices. Despite the rise, the increase in terminal prices was limited, which constrained the extent of the overall price hike. Prices for PET in China declined by over 6.5% during this period, exacerbated by low feedstock costs and high inventory levels. As the weather turned cooler, end-user demand slowed down, adding pressure to the market.

In summary, the global PET market experienced a significant decline in early half of September 2024, largely driven by the impact of falling crude oil prices. However, recent crude oil price surges, influenced by a hurricane in the Gulf of Mexico, China's stimulus measures, and heightened tensions in the Middle East, are expected to influence future trends. Analysts anticipate that PET prices will likely continue on a downward trajectory unless there is a significant shift in feedstock market dynamics.

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