China PET bottle chip export delivery creates new high in Jan-Mar 2024

According to customs data, in March 2024, the total export volume of PET bottle chip and PET fiber chip was 606,000 tons, a year-on-year increase of 26.9%. Specifically, the tariff number 39076910 accounted for 90,000 tons, a 37.4% increase, and 39076110 for 516,000 tons, a 25.2% increase, setting a new historical high in monthly export volume. From January to March 2024, the total export volume of PET bottle chip and PET fiber chip reached 1.538 million tons, a 13% increase year-on-year. Within this, tariff number 39076910 covered 249,000 tons, a 54% increase, and 39076110 was 1.289 million tons, a 7.6% increase. Based on factory delivery condition and two HS codes figure, PET bottle chip exports in the first three months of 2024 was around 1.4 million tons, a 10% increase from 2023 and a significant 49.4% increase from the same period in 2019.

Since shipping volume setting a new record in November last year, the achievement of another historical high in export volume in March 2024 can be attributed to two main factors. Firstly, as crude oil prices were volatile around the Chinese New Year, while PET export prices remained relatively stable at lower levels, overseas downstream markets showed relatively active replenishment. Secondly, from January to March, domestic PET bottle chip factories experienced a substantial increase in export order intake, up 49% from the previous year, with monthly average order intake hovering around 450,000 tons since the fourth quarter of last year. Therefore, theoretically, if shipments in a certain month fall below this average, there is a high probability of making up for this in the following one to two months, especially considering the impact of the Chinese New Year holiday in February.

However, it is worth noting that based on preliminary research this month, the export delivery speed of PET bottle chip factories remains acceptable, but domestic sales seem to have slowed down in the first half of the month. Despite Q1 export volume reaching a historical high, the proportion of PET export volume to total domestic production, which is around 3.53 million tons, has decreased to around 38%, compared to approximately 43% during the same period last year. The relatively subdued replenishment atmosphere in the domestic market has put pressure on market prices and profitability. Currently, the average inventory level of PET bottle chip factories maintains at around half a month, with more sales pressure shifting to traders and end-users. Nevertheless, it cannot be ruled out that there may be a continuous accumulation of inventory in the future as market supply increases significantly.