US PSF Prices Showcase Upward Trend Amid Steep Import From China
- 11-Oct-2023 2:21 PM
- Journalist: Emilia Jackson
In a surprising turn of events, the prices of Polyester Staple Fibre (PSF) in the US market admitted an uptick of +1.5% during the second half of September 2023 compared to the previous month's decline under the influence of Chinese high-priced cargoes. However, since August, the price of PSF in the US market has been declining, resulting in the formation of a negative feedback mechanism.
The US, a prominent PSF importer from China, mostly relies on this country to meet its domestic PSF demand. As per the data, the exports of textiles in the USA have declined by -3.57% in August compared to the previous month, which depicted negative buying sentiments from the downstream textile industry for PSF. However, after witnessing the declining trend in August, the PSF prices in the USA experienced an uptick of +1.5% with strong feedstock Crude oil and upstream Paraxylene prices, coupled with a reduction of stocks to settle at 1302 USD/ tonne PSF CFR Texas PSF during the second half of September. As in the Chinese market, the prices of PSF admitted a bullish trend during H2 of September amid the supply curtailment of raw materials. Therefore, the imported cargoes from China remained at a higher end compared to August.
Market reports have highlighted external factors that continue to challenge the PSF market in China amid the market permitted a decent hike during the second half of September amid supply curtailment in the domestic market. China's feedstock Paraxylene supply did not meet the current demand for manufacturing PSF during this timeframe. This was due to the unit shutdown of PetroChina Sichuan Petrochemical, which led to higher production costs for PFY. Along with this, a few feedstock MEG units were put in maintenance turnaround from early September, including BASF-YPC and Sinopec Shanghai Petrochemical INEOS Aromatics in Nanjing, Jiangsu in China, having a capacity of 300,000 mt/year, which further participated in the lesser availability to produce PSF. Furthermore, the availability of another feedstock PTA has further contributed to the supply disruption as the Jiangsu Honggang Petrochemical in Lianyungang has put their PTA plant in maintenance turnaround, having a capacity of 2.4 million mt/year in mid-September 2023. As a ripple effect, the lack of raw materials caused a chain reaction that led to higher prices for PSF in the Chinese market.
As per ChemAnalyst, the PSF prices in the international market may admit stability due to the ongoing long holiday in China till 6th October 2023. However, the changes in the Crude oil prices, which often correlate with PSF prices, are expected to significantly shape the market's future trajectory.