PET bottle chip downstream round-up in Q1-Q3 2025

According to CCFGroup tracking statistics and subsequent data revisions, the domestic demand for PET bottle chip from January to September 2025 was approximately 7.357 million tons, a year-on-year increase of 6.8%. The growth was primarily driven by rapid increases in tea beverages and functional beverages, with significantly higher demand for summer cold drinks. Meanwhile, China's PET export prices maintained a relatively clear advantage this year, and procurement demand from overseas markets remained strong. China's total exports of PET bottle chip from January to September reached approximately 5.26 million tons (this figure is an estimate based on two tariff codes), a year-on-year increase of 15.9%. By the end of September, the total inventory of PET bottle chip in China reached approximately 2.77 million tons, an increase of nearly 480,000 tons compared to the end of last year, maintaining an inventory accumulation pattern. However, bottle chip plants showed a slight destocking by the end of September compared to the peak in the second quarter.

In the first quarter, the beverage and edible oil industries benefited from seasonal consumption, leading to a short-term spike and subsequent decline in PET consumption. The PET sheet sector faced threats of increasing homogenization and further price competition. After the Lunar New Year holiday, many PET sheet enterprises delayed resuming operations by one to two weeks. In the second quarter, as major downstream end-users had mostly made advance purchases earlier, overall procurement activity was relatively low. Shipments from bottle chip plants initially increased but later declined. At the beginning of the third quarter, with the arrival of summer heat, demand from downstream beverages and bottled water sectors rose again. As PET prices gradually fell to low levels, inquiries and procurement activities from major end-users began to increase.

In bottled water and beverages sectors, demand for PET packaging performed impressively in the first three quarters, reaching approximately 5.12 million tons, a year-on-year increase of 7.8%. In the first quarter, as some major beverage manufacturers had already procured orders for the first half of the year, procurement activity was relatively limited. Post-holiday concentrated restocking mostly occurred from late February to March. Since most water companies achieved good sales and profit targets the previous year, production of mainstream brands maintained stable growth in the first quarter. However, some brands underperformed in actual sales, leading to weaker restocking momentum later. Additionally, some beverage companies' pursuit of lightweight packaging reduced PET usage per bottle, potentially offsetting some of the incremental PET demand. In the second quarter, PET prices fell sharply in April due to additional U.S. tariffs. However, as many major end-users had already built up significant inventories earlier, procurement activities remained relatively cautious. Despite this, the clear decline in raw material costs allowed PET bottle chip plants to secure profitable orders earlier, with some major manufacturers turning losses into profits by the mid-year financial reports. In the third quarter, due to the prolonged summer heat, beverage companies operated at slightly higher rates compared to the same period in 2024, and downstream restocking activities gradually increased compared to earlier periods.

In edible oil section, demand for PET decreased by 0.6% year-on-year in the first three quarters. Specifically, in the first quarter, demand from edible oil companies fell by approximately 14.4% year-on-year, mainly due to saturated growth in household consumption. However, the recovery of the catering industry moderately boosted demand for large-capacity PET containers. After the Spring Festival, as the market entered a relatively off-season, overall operating rate in edible oil companies stood low. In the second and third quarters, with more holidays and the peak tourism season, edible oil demand saw a slight rebound, with PET demand increasing by 6% year-on-year. However, due to the small base unit, the overall net change in demand was minimal.

In PET sheets and other sectors, PET demand increased by 5.4% year-on-year in the first three quarters, with a 2.7% year-on-year decline in the first quarter, largely due to delayed factory resumptions. In East China, due to earlier development in new end-user applications, packaging demand for fresh produce, milk tea, and coffee showed decent growth. Promotions by the three major food delivery platforms further drove significant demand growth, with some PET sheet manufacturers operating at near-full capacity in the third quarter. In South China, however, homogenized competition intensified further, and downstream end-products remained relatively homogeneous. Many PET sheet manufacturers opted to replace virgin chips with recycled bottle chips or reduced production lines to lower costs. Nevertheless, when virgin PET bottle chip prices fell to historically low levels, demand for virgin materials rose again. Relatively speaking, local integrated enterprises secured more orders, with clear cost advantages and satisfactory operational rates.

In summary, the domestic PET bottle chip market from January to September 2025 generally exhibited an inventory accumulation trend. However, benefiting from continued growth in export share and prolonged concentrated maintenance shutdowns during the year, PET bottle chip plants successfully managed inventory pressure by the end of the third quarter, with improved profitability. In the fourth quarter of 2025, only the Fuhai facility is expected to commence. If PET bottle chip plants can maintain the current production reduction and shutdown status, the pace of market inventory accumulation may slow. Further developments in plant operations will require close monitoring.