PET bottle chip price declines to support sales and profit

After the National Day holiday, upstream polyester raw material prices continued to decline. Although the price of PET bottle chip followed the downward trend, the decline was slower than that of raw materials, resulting in an expansion of the processing margin. As of October 14, 2025, based on the CCFGroup spot average price, the processing margin for water bottle chip in East China was 493yuan/mt, reaching the second-highest level of the year (the peak occurred in April, when a rapid decline in raw material prices brought the processing margin to nearly 600yuan/mt).

Buyers in the PET bottle chip market concentrated on restocking when prices fell to periodical low. In just the five working days after the National Day holiday, domestic sales of PET bottle chip reached approximately 400,000 tons, averaging nearly 80,000 tons per day. The bulk of the transactions occurred on October 9, October 10, and October 14. Among these transactions, spot restocking for October accounted for a small proportion. Most traders focused on replenishing inventories for Nov-Dec delivery, while major downstream end-users had already procured materials in advance for Q1-Q2 2026 delivery.

So why did the profitability and transaction volume of PET bottle chip improve significantly during the price decline? On the one hand, the recent continuous decline in upstream raw material futures created significant negotiation room for forward sales of PET bottle chip. Previously, absolute prices were high, but processing margins were only around 300yuan/mt. Recently, however, margins of at least 500yuan/mt or more could be negotiated, with absolute prices remaining relatively low. This situation satisfied both bottle chip producers and downstream end-users. On the other hand, the decline in raw material prices provided some support for PET bottle chip producers' earlier orders. From a rolling operation perspective, purchasing raw materials at lower prices could help offset earlier losses.

For the fourth quarter, if raw material costs keep fluctuating near low rates, the absolute price of PET bottle chip is expected to be suppressed at relatively low levels. Major end-users, within their annual budgets, are likely to consider restocking ahead of time, which could lead to sustained high market transaction volumes. As mentioned in earlier articles, if transaction volumes in the fourth quarter are adequately supported, the year-end processing margin for PET bottle chip may not be overly pessimistic. However, due to the poor reception of new export orders earlier, preliminary reports indicate that some major bottle chip producers have seen a decline in stored export orders compared to previous years. If export orders do not improve significantly in the fourth quarter, overseas market support for domestic sales may weaken.