PET flakes market under pressure amid weak recycled chemical fibers

In Nov, recycled chemical fiber market sales have been constantly thin and prices generally move downward or discussing space expands.

For close virgin PSF, some producers adjusted lower the offers by 100-200yuan/mt with lower virgin PSF market, and some producers maintained. The sales were under negotiation overall. Producers reflected that sales slowed down, and inventory accumulated. In Hebei, some plants cut production or suspended operation impacted by the epidemic.

HC virgin PSF prices lowered successively since Nov, weighing on HC re-PSF market. HC re-PSF trading prices were flexible, and could be lower for big deals. Plants focused on selling. In Zhejiang, prices were dampened with fierce competition, even lower than the neighboring cities’. End-user orders lacked, and downstream buyers and traders mostly stood on the sidelines, and purchased for pressing demand.

Recycled PFY, especially high-end and eco-friendly re-PFY, has seen prices lower continually in the second half of the year. Moreover, market demand was soft and operating rate was low. It was heard that some plants only ran at around 20-30%.

Under the continual outbreaks of epidemic in many regions, especially in some key textile markets, the transportation and downstream plant production was impacted, further impacting the sales of recycled chemical fiber sales. Meanwhile, the consumption of soft drinks and mineral water reduced, especially in some tourism cities, recycling volumes of rough bottles decreased. Some regions were under continual COVID control measures, making further reduction of rough bottles and rough bottle bales. Moreover, entering winter season, temperature has dropped quickly and bottles continued to reduce.

In early Nov, bottle bales in Fujian and Suzhou moved up, and PET flakes prices were flat. But affected by lower recycled chemical fiber prices and weak demand, prices in Anhui and North Jiangsu lowered by 200-300yuan/mt, and hot washed blue and white flake prices in Zhejiang reduced by 50-100yuan/mt. The supply and demand sides of PET flakes were at a deadlock somewhat.

For late market, with on-going epidemic, market demand keeps weak. Virgin polyester product prices are still likely to weaken. Recycled chemical fiber inventory keeps accumulating. Though PET flake supply is tight, buying enthusiasm is hard to improve in short. PET flakes prices are under pressure.