Polyester Chips Drops Continuously

    It is not difficult to describe the recent polyester chips market: In terms of macro environment, the Europe debt crisis is fickle, and the pressure of appreciation of RMB still exists, which damaged the market confidence. Basically, the reasons are the following three points: first, the polyester chips market lacks of upstream raw materials support and the price begins to drop; second, the operating rate of polyester chips downstream factories is not high, and the purchasing atmosphere is light and the market keeps watching and seeing; third, some factories dropped price and undersell in order to decrease the stock, resulting the market panic. The vicious circle leads to polyester chips price drop continuously, which has already dropped to 11,800-11,900 Yuan/Ton.         
    Seeing from the recent market situation, the sluggish polyester market situation is difficult to improve in a short term. In addition to the low demand to raw materials of downstream factories, in the earlier stage, the investment of polyester factories is too quick, which leads to the excess production.     
    The polyester raw materials situation is troublesome. The PX price tends to drop and is difficult to support the PTA price. Now, the PTA spot goods price in domestic market is 8,750 Yuan/Ton, and the bidding intension is low. The transaction in the polyester market is limited and the demand is weak, so it is estimated that PTA market will keep weak. The MEG quotation is 8,770 Yuan/Ton in domestic market, and the practical transaction is lower; the price is 1,120 USD/Ton in overseas market and the transaction is also a few. Now the traders who have spot PTA and MEG all want to sell out as soon as possible. The more price dropped, the more market transactions deceased. This kind of vicious circle caused the polyester chips lost cost support.    

    Looking market outlook, under the weak macro aspect and raw materials market, it is difficult to change the drop trend of polyester chips price. Meanwhile, the most important thing is the downstream demand is not improving. The polyester chips which is in the intermediate link influenced by both upstream and downstream, it is estimated that the market will still be weak and the price may drop dramatically once again.