Weak Demand Fundamentals Keep the BOPET Film Market on a Lighter Note in Europe
- 26-Sep-2022 5:25 PM
- Journalist: Nicholas Seifield
Hamburg (Germany): Packaging Film manufacturers experienced subdued demand in Europe, which pulled the BOPET (Biaxially-Oriented Polyethylene Terephthalate) Film market down in September while lowering feedstock prices also supported the declining trend to continue.
The BOPET Film market declined in Europe due to the plummeting demand fundamentals. As per the market sources, several manufacturing units are reducing their operating rates foreseeing high-cost production. However, the primary concern regarding price fall is its reducing offtakes from packaging sectors.
Similarly, the price for feedstock Polyethylene Terephthalate (PET), which utilizes PTA (Purified Terephthalic Acid) and MEG (Mono-Ethylene Glycol) for its production, has also been declining in the regional market. At the same time, the persistent rise in utility costs has been worrying for many manufacturers, forcing them to reduce their operating rates. In addition, the BOPET Film prices may continue to decline in the following weeks, especially in the importing countries, considering lower freight charges from Asia.
On the other hand, China provides BOPET Film at discounted prices as the availability of the material surpasses its demand. The prohibitive heat has also reduced downstream production in the beverage industries. Thus, food packaging applications fared better than the beverages sector due to the sustained demand for perishable goods.
According to the ChemAnalyst pricing intelligence, due to high production costs and narrowing market sentiments, the profit margins in the BOPET Film market have declined by 1% and 3%, respectively, in the European and Asian markets.
The market forecast states, "The weaker market sentiments for BOPET Film may persist throughout the coming weeks as demand is not expected to grow. Also, the high production cost has led to a slow operating rate since small industries preferred to remain closed, rather than operating at high production cost amidst feeble demand."