Global : Polyester Prices Likely To Bottom Out

As the raw material prices stopped declining the polyester prices are now expected to bottom out.

Prices of Purified Terepthalic Acid (PTA) and Mono Ethylene Glycol (MEG) began slightly rebounding in the past days.

Before bottoming out, PTA prices fell below levels reached by the end of last year, down to about US$498 per ton. This is a 38% decrease in less than two weeks.

MEG prices did not so rapidly fall and began rebounding from much higher levels, partly due to an outage in Asia.

Oil prices are no more decreasing

The rebound in PTA and MEG prices is not only due to the low level reached in the past weeks. Crude oil prices also bottomed out in the recent period after falling as a result of US offensive in Iraq.

Benchmark Brent crude oil is now back to US$26 per barrel as OPEC country members could decide cutting production no later than next Thursday.

Although Iraqi oil will not be available on the global market before months, world consumption is usually lower in the second part of the year therefore putting pressure on prices.

OPEC members prefer reducing production rather than suffering from a new fall in prices.

As a result, polyester prices are expected slightly rising in the short term. They would not surge, either, since demand from Asia's textile industry remains very weak, now depressed by SARS expansion after the Iraq war negatively affected global activity.

In Pakistan, polyester prices were again lowered in the past week, nearly returning to the level experienced in November.

In China, prices also continued decreasing in the past seven days mainly due to the low level in domestic demand.