Current situation of domestic PET market in September
In September, the overall PET market for water bottles in East China surged and then fluctuated at a high level. In the first half of the year, the market continued to rise unilaterally, with prices steadily rising from around 8200 yuan/ton. Supported by upstream raw material costs and the favorable trend of low inventory in the industry, the market has a strong bullish atmosphere; The mid price surged to the high point of nearly 9000 yuan/ton in this round of market trend; In the second half of the month, the market quickly rebounded to around 8700 yuan/ton without experiencing a deep decline. Subsequently, the market fluctuated and stabilized with a slight rebound, and prices rose again at the end of the month, showing an overall trend of rising sharply, falling sharply, and strong high-level fluctuations.
Analysis of the driving force of the monthly market trend
In the first and middle of September, PET prices surged, with the core being supported by cost factors such as crude oil PX、PTA、 The ethylene glycol market continues to strengthen, with low inventory and tight spot prices at ethylene glycol ports. The upward trend of polyester raw materials has driven up PET costs, and the repair of bottle processing fees has led to a strong willingness of production enterprises to push prices; In terms of supply, multiple bottle tablet devices underwent maintenance and load reduction in August. In early September, the circulation of spot goods was limited, and the industry’s social inventory was low. The tight supply of goods supported the quotation; The expected peak season for the “Golden Nine” beverage industry, coupled with market competition, saw downstream bottle preforms and beverage companies stocking up before the holiday, while traders followed suit to boost the market.
In the middle of the month, the price surged to the stage high and then quickly fell back, mainly due to the large short-term increase, the cost pressure on downstream beverage companies, and the drying up of high-level procurement willingness, only maintaining on-demand small order procurement; At the same time, traders stocked up at low prices in the early stage and concentrated on cashing in profit orders around 9000 yuan/ton, showing selling pressure. In addition, the actual demand for terminal beverages was limited, and expectations during peak seasons were falsified, leading to a cooling of market sentiment.
After the market correction, there was no deep decline, and upstream PTA and ethylene glycol still had cost support. Raw materials did not experience a cliff like decline, and PET factories had little inventory pressure. They had a strong willingness to raise prices and were unwilling to offer significant discounts. After the correction, demand for replenishment at low prices emerged, and prices stabilized in the range of 8600-8800 yuan/ton, with a slight increase at the end of the month.
Future forecast
The current fundamentals of water bottle grade PET in East China show a pattern of strong cost support, supply contraction to support the bottom, and weak terminal demand. On the cost side, crude oil PX、PTA、 The ethylene glycol market is relatively strong, with low inventory at ethylene glycol ports. The upward trend of polyester raw materials has driven up PET production costs, and the processing fees for bottle chips have been repaired, providing strong support for prices. On the supply side, since August, the industry has concentrated on carrying out equipment maintenance and load reduction, causing a decline in industry operating rates, tightening spot circulation, maintaining low factory inventory, tight supply, and strong willingness of production enterprises to raise prices. In the short term, the supply side has formed a bottom line for the market. There is a clear differentiation on the demand side, driven by the expectation of the “Golden September” in the early stage, downstream bottle preforms and beverage companies concentrated on replenishing inventory before the holiday, driving up prices; But after the price surge, downstream cost pressure became prominent, and there was insufficient willingness to chase after high prices. Only on-demand small orders were maintained, and the actual consumption increment of terminal beverages was limited. The expectation of peak season gradually proved false. There is no significant increase in the export end, and the external demand pull is weak. Overall, the upward trend of PET prices is mainly driven by costs and low inventory, with downstream terminal demand becoming the main constraint of the market. Under the long short game, the market fluctuates at high levels
Based on comprehensive fundamental analysis, the East China water bottle grade PET market is expected to fluctuate at a high level and have a slightly weak center of gravity in October, with a price range of 8400-8900 yuan/ton as a reference. At the beginning of the month, the high trend at the end of September continued. With the traditional peak season for beverages coming to an end and downstream entering a seasonal off-season, coupled with the gradual restart of maintenance equipment in the early stage, the pressure on the supply side slowly rose, and the market may fluctuate and fall back; But crude oil PTA、 Ethylene glycol still has cost support, factory inventory is low, and there is a strong willingness to raise prices, with limited room for deep decline. If raw materials strengthen again in the second half of the year, there is a chance for prices to rebound.
On the cost side, crude oil PX、PTA、 Ethylene glycol remains the dominant variable in the market, with raw materials fluctuating at high levels due to geopolitical factors, providing support for the bottom of PET. However, beverage consumption has weakened, and there is limited room for further expansion of bottle processing fees. On the supply side, the low inventory pattern continued in September, and some early maintenance bottle devices are planned to restart in October. There is an expectation of a rebound in operating load, and the supply side support is gradually increasing compared to September. On the demand side, as the weather turns cooler, soft drink consumption has entered the traditional off-season. Downstream bottle preform and beverage companies have already completed pre holiday stocking in the early stage, but will mainly consume their own inventory in the future. There is a lack of willingness to replenish inventory on a large scale, and only maintain small orders for essential needs. Demand has become the main suppressing factor in the market.
Overall, the PET market in October was a game between cost support and off-season demand, with insufficient basis for a sharp rise and limited room for a significant decline, mainly characterized by range fluctuations. Key attention should be paid to fluctuations in crude oil prices, polyester raw material prices, progress in restarting bottle and chip equipment, and changes in downstream beverage industry procurement; The risk lies in the significant fluctuations in crude oil caused by geopolitical conflicts and the increase in supply brought about by the concentrated resumption of production facilities.
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