PET resin prices increased by E55-60/tonne despite disappointing sales and a plentiful material supply. Feedstock cost increases were the main price driver. The cost of paraxylene (PX) increased by E92/tonne against May, while MEG was down by E10/tonne. The overall impact of these cost movements on PET costs was around E50/tonne, which represents a small margin gain for producers.
Demand for PET resin was less than expected in June but the recent improvement in weather conditions should boost sales this month.
The feared destabilisation of the PET market caused by force majeure being called at the PTA plants of Interquisa at San Roque, Spain, and BP's Geel facility in Belgium did not materialise. Interquisa plans to lift force majeure in early July and BP's plant is back in production.
However, PTA will remain in short supply for a few weeks until production levels are back to more normal levels.
PX prices are expected to reach a peak in July, rising by at least E50/tonne compared with June levels. In response, PET producers will aim for sizeable price increases to cover the higher costs and improve their margin position.