Polyester prices are staying firm in China whatever the fall of glycol prices and the current weakness in demand from downward textile industry. Prices could however decline over larger inventory levels in the second part of April.
Polyester prices have not really moved in the past week in China, which is actually hiding opposite trends on upward and downward markets.
Demand for polyester fibers is slowing down, according to market participants, with stocks piling up at plants.
China’s textile industry is still losing steam, partly due to rising uncertainties around trade negotiations with the United States.
Although optimism is back currently in China, demand for textiles could suffer from slowing down sales at retail and lower apparel exports to the European Union.
Polyester prices have not yet dropped, however, due to a rise of PTA prices in the past weeks.
The PSF/PTA and POY/PTA spreads have slightly declined in the last seven days (see below table), reflecting a fall of margins at polyester plants.
MEG prices have however heavily fallen in the past weeks and months, offering room for accepting higher PTA prices at the same time.
Operating rates are still kept at very high levels at polyester plants whatever the current rebound of inventories.
With margins also staying at historically high levels, polyester producers may accept to lower their prices in the coming period.
Source: Emergingtextiles
