HC re-PSF prices move up driven by costs

Oil prices were range-bound at high level. OPEC and non-OPEC ministers finished Friday’s meeting without a resolution and they decided to meet again on Monday on oil output policy. Then during the night trading session of last Friday, PTA futures moved up quickly, with the major contract closing at 5,232yuan/mt, up 108yuan/mt or 2.11%, MEG futures at 5,113yuan/mt, up 94yuan/mt or 1.87% and PSF Sep contract at 7,350yuan/mt, up 96yuan/mt or 1.32%.

Pushed up by the costs, polyester product prices moved upward in general on July 3. PFY offers in Zhejiang and Jiangsu rose by 50-150yuan/mt mostly, PET fiber chip up by 50-100yuan/mt, and HC virgin PSF up by 100-200yuan/mt partially. For HC re-PSF, offers in Guangdong rose by 100-200yuan/mt overall, to be mainly offered at 6,400-6,900yuan/mt pre-tax ex-works, and in Zhejiang, some plants intended to raise the prices.

In Guangdong, affected by the electricity restriction previously, HC re-PSF supply is disrupted, and the inventory keeps low since the Chinese Lunar New Year holiday, so the upward momentum is strong. In Zhejiang, inventory is high and plants focus on selling.

Recently, HC re-PSF market focuses on selling, and the fundamental in downstream market sees no obvious improvement. Some plants concern about the continuity. If downstream demand can improve at the same time, then the trading volumes and prices will all improve.