Nov China BOPET Price Further Dropped
The BOPET price moved down but the profit climbed. As of October 28, the average market price of 12μ BOPET was RMB 8,388/mt, down RMB 195/mt or 2.27% from last month and down 28.18% from last year.
1. BOPET Price Trend
China BOPET Monthly Closing Price
Unit: RMB/mt
BOPET market prices kept going down in November. The crude oil prices fluctuated downward in the week, dragging down the prices of PTA and MEG. It was difficult for the PET chip prices to reverse the downtrend, so the support of cost to the BOPET market weakened. There was no major change in supply as the impact of new maintenance plans was offset by the restart of overhauled units. The supply was under pressure on the back of ample spot resources. As for demand, downstream users were bearish on the market outlook and mostly purchased feedstock on a need-to basis, suppressing the speculative demand. Market prices of BOPET dropped amid the aggravated imbalance between supply and demand.
According to SCI, as of November 28, the negotiation price for 12μ general-purpose BOPET in East China was about RMB 8,110-8,310/mt, down RMB 300/mt from last month and down RMB 2,950/mt from last year. The monthly average price was about RMB 8,388/mt, down RMB 195/mt or 2.27% from last month.
2. China BOPET Industry Operation Analysis
The overall industry operating rate inched down M-O-M. Five production lines were restarted in the month, but 7 productions were still in maintenance
Downstream players retreated to the sidelines in November, with decreasing procurements of feedstock. The decline in demand was larger than that in supply, escalating the contradiction between supply and demand. The overall inventory was at 11.67 days’ worth, which was at a five-year high level
3. BOPET Market Detailed Operation Data
The overall industry operating rate did not change greatly as the unit restart was offset by the new turnaournds. The demand reduction was larger thant the supply reduction, lifting the inventory at producers. The overall inventory was still at a historically high level.
The BOPET profits increased in November. The crude oil price moved down, and prices of PTA and MEG followed the downtrend. The mainstream negotiation price of BOPET moved down in November, which was around RMB 8,110-8,310/mt, down RMB 300/mt from last month. On the whole, the average profit at BOPET enterprises was RMB -36/mt, up RMB 332/mt from last month.
According to the 14 sample companies, it was estimated that the order level for general BOPET was around 8.57 days by late November, down 2.72 days from last month and down 11.58 days from last year.
4. BOPET Market Outlook
Forecast: SCI reckons that the BOPET market may fluctuate downward in December. As for cost, the feedstock prices may not provide notable support to the BOPET market. The uptick in demand may be offset by the newly added capacity. The imbalance between supply and demand may aggravate as the supply growth may exceed the demand growth. SCI predicts that the negotiation price for general-purpose 12μ BOPET in East China will be RMB 7,710-8,210/mt next month. The monthly average price from December 2022 and February 2023 is estimated at RMB 8,010/mt, RMB 7,810/mt and RMB 8,010/mt respectively.
Cost: The prices of PET chip may fluctuate downward in the next three months. There are three main reasons. First, the cost may not lend strong support to the price of PET chip. Second, the market is still in oversupply, though the reduction in supply is larger than that in demand. Third, the downstream demand is in the slow season. Overall, it is predicted that the PET chip price will fluctuate downward in December. SCI holds that the monthly average price of semi-gloss PET chip from December 2022 to February 2023 will be RMB 6,500/mt, RMB 6,400/mt and RMB 6,300/mt respectively
Supply: In the next three months, 5-7 new production lines will still be put into use. The overall supply in December is expected to increase as the overhauled units in Fujian may be restarted. There will be more turnarounds during the Spring Festival holiday, so the supply is expected to decrease by then. However, after the holiday, unit restart and new capacity commissioning may lift the supply again.
Demand: The demand may pick up a little in December, driven by the festivals. If the prices drop to the expected level, downstream players may raise their procurements. As for orders, the current order level contracted, registering weakened support for the prices.
All information provided by SCI is for reference only, which shall not be reproduced without permission.
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