Chinese PET slipped below $1050/ton threshold in Indonesia

Import PET bottle offers from China to Indonesia tumbled toward the end of the week with prices fell below the $1050/ton threshold for the first time in 18 weeks. Weak demand and constant downward pressure from the upstream costs are driving the market.

IIn fact, Indonesian buyers reportedly receiving offers from a Chinese supplier at $40/ton reduction from last week to $1040/ton CIF Indonesia, LC AS.  “But we think the market might soon breach below the $1000/ton mark, therefore, we decided to be cautious,” a buyer commented.

Ample supply has been pulling Asian MEG market lower for months and at the moment, the average MEG costs based on CFR China term has reached $525/ton, down more than $50/ton from last week. Meanwhile, downstream demand from both the polyester and PET sector is dwindling amid the escalated trade war between China and the USA. This might keep any rebound trend in check. 

According to market sources, China’s Sanfangxiang has already cut production rate at its 2.1 million tons/year PET plant in Jiangyin to 80% this week due to weak sales. However, this information has not been verified at the time this report is published.