A New Round of BOPET Capacity Expansion Started
According to SCI, from 2016 to 2020, the profit at BOPET producers turned a loss into a gain. From 2016 to 2017, the profit was negative most of the time due to the supply surplus. In H2, 2017, some large plants conducted maintenance and enterprises switched the production from general-purpose products to differentiated products. BOPET prices went up steadily amid the improvement between supply and demand. In August 2018, the feedstock price extended gains, supporting the BOPET market from the cost side. The profit at BOPET enterprises reached the highest level since 2013. Driven by the profit, enterprises built new production lines. However, the construction cycle was more than 18 months, laying the foundation for the commissioning of the new production lines in 2020.
The production lines constructed in 2018 was expected to be put into use in March 2020 at the earliest. However, affected by the public health event, the commissioning time was delayed. By December 11, only 235kt/a capacity of the planned 460kt/a capacity was put into use, accounting for 51.09% of the total. The rest production lines will be put into use in 2021. The production lines put into use mainly produce 50-350μ BOPET. The supply-demand fundamentals in the general-purpose BOPET were still in the tight balance. Besides, the BOPET prices dropped to the historically low prices. Thus, some users stockpiled at the low prices. The short-run mismatch between supply and demand led to the supply tightness. Later, the BOPET market kept going up amid the supply tightness and climbing demand. However, there was no improvement in the feedstock market. The profit at BOPET enterprises rose from RMB 2,000/mt in early 2020 to RMB 7,500/mt in late 2020, up RMB 5,500/mt. The annual average profit was RMB 3,830/mt, up RMB 1,337/mt Y-O-Y.
