Weak Demand Outlook Followed by Several Capacity Additions to Pressurise Asian PTA Prices in the Next Quarter
Asia PTA market has witnessed an overall ease in the supply overhang majorly due to couple of turnarounds in PTA facilities in China in the last quarter. The situation was exacerbated when two leading PTA manufacturers in India, MCPI unit and Reliance Industries shut down their PTA plants due to demand destruction and excess inventories. Moreover, downstream Polyester manufacturers have continued to operate their plants at a reduced rate around 30-40 per cent on lack of textile demand in the region amid existing Coronavirus crises. Th stable demand and supply gap of PTA in Asian Market is under shadows with scheduled addition of 7.1 MTPA PTA capacity in China. Aside from no upcoming shutdowns in the coming months, this huge capacity addition is likely to add further pressure on market sentiment of PTA in Asian region. Furthermore, weak fundamentals on the back of dwindling demand outlook of Polyester market will continue to weigh down PTA prices with supply overpowering the demand.