Re-PET feedstock price trend analysis

Since recycled plants resume operation since the Chinese Lunar New Year holiday, recycled PSF prices have experienced a round of slight rise before the Lantern Festival, and then prices maintained for about half a month. Later, as sales continued to be sluggish and inventory accumulated, market prices started to decline apparently around Mar 10. Close virgin PSF prices in Hebei market declined the most, and prices have lowered by 400yuan/mt compared to the level around Chinese Lunar New Year. For other products, prices of close virgin PSF in Zhejiang and Jiangsu and HC re-PSF decreased by around 200-300yuan/mt. As some plants continued to cut prices, market confidence lacked obviously, and downstream buyers were more cautious to purchase with weak demand, mainly buying for pressing demand.

With the weak demand for recycled chemical fibers and low processing spread, many plants adjusted lower the procurement prices of feedstock. In Hebei, rough bottle bales prices kept downward after the holiday, down by 400yuan/mt. The price decline moved from North China to South China. Bottle bales and PET flakes trading prices went downward generally in Jiangsu, Zhejiang, Fujian and Guangdong, down by 200-300yuan/mt. During this round of decline, imported PET flakes prices in Zhejiang slipped obviously. Some traders were active to sell amid the panic mood and currently, some blue and white flakes prices declined below 6,000yuan/mt, down by nearly 500yuan/mt compared to some transactions of 6,400-6,450yuan/mt before. Part of orders is still on afloat and some losses may be seen for traders.

After the holiday, the price trend of 3A-grade white flakes was similar to that of conventional PET flakes, up first and then down. The prices moved up temporarily after the holiday, seeing high trading prices of around 7,550yuan/mt, and then declined to 7,200-7,300yuan/mt by now. 3A-grade white bottle bales saw less price decline.

For popcorn, prices fluctuate limitedly, with a range of 200yuan/mt after the holiday. Currently, the mainstream trading prices are still higher than the level before the holiday, mainly supported by the tight supply for long time.

In the short term, after experiencing the obvious decline after the Chinese Lunar New Year holiday, the bottle bales and PET flakes inventory have transferred to cleaning plants and recycled chemical fiber plants. The overall supply is not sufficient currently. Prices are forecast to move sideways weakly. Later, temperature will go up after the Tomb-Sweeping Festival holiday, market supply is expected to increase. Coupled with the weak recycled chemical fiber market sentiment, prices are still likely to go downward further.