PET Prices Under Pressure Amid Weak Cost Support and Tepid Demand

Key Highlights

• Domestic Prices Steady: WK-801 at ₹83,500/MT and WK-821 up to ₹85,250/MT across key cities.
• Raw Material Costs Drop: PTA and MEG prices fell sharply, driven by lower crude oil benchmarks.
• Supply Surplus Continues: Despite lower utilization, inventory levels remain high, signaling oversupply.
• Demand Remains Weak: High product stocks and cautious downstream sentiment limit large-volume buying

Domestic & Global PET Price Snapshot

• In the Indian Market, the WK-801 grade is priced at ₹83,500/MT in both Ahmedabad and Mundra. Meanwhile, the WK-821 grade is priced at ₹85,250/MT in Ahmedabad and Hyderabad, and slightly lower at ₹84,250/MT in Daman and Mundra.
• In the China Market PET flake prices continued to exhibit weakness last week. The average selling price for PET bottle flakes stood at USD 830/ton.
• On the feedstock side, cost pressure eased significantly:
  1. PTA spot prices fell to USD 677/ton.
  2. Ethylene glycol spot prices dropped below USD 610/ton.
• This downward trend in raw material prices was largely influenced by a decline in Brent crude oil, which dipped below USD 70 per barrel, a key support level.

Production and Inventory Status Across Markets

• Supply Side: Domestic PET production was 382,600 tons, marking a week-on-week decrease of 6,800 tons. The capacity utilization rate fell to 84.64%, down 3.7% from the previous month due to routine maintenance activities. Despite the short-term dip in output, overall supply remains ample, with inventory levels high at 16–18 days, signaling a continued oversupply scenario.
• Demand Side: The soft drink sector has rebounded to an 80–90% operating rate, yet end-product inventories remain high, curbing fresh bulk orders. Buying behavior is restricted to small-volume restocking for immediate needs, reflecting subdued downstream confidence. While export volume in February rose 27.3% YoY to 487,600 tons, this momentum has not sustained due to global economic headwinds and overseas anti-dumping investigations.

Market News and Influences

• Raw Material Weakness: The drop in crude oil—driven by OPEC+ production forecasts and U.S.–Iran nuclear negotiations—has put additional pressure on feedstock markets such as PTA and ethylene glycol, which directly impacts PET margins.
• Production Outlook: Despite temporary maintenance-led reductions, China's PET capacity is expected to expand by 2.15 million tons by 2025, further intensifying long-term supply pressure.
• Export Challenges: The initial export growth has been tempered by global macroeconomic softness and trade protectionism, limiting upside potential for producers relying on overseas markets.

Expert Opinion: Short-Term Price Forecast & Strategic Takeaways

• Given the persistent raw material softness and lackluster downstream buying interest, PET bottle chip prices are expected to remain range-bound at lower levels in the short term.
• Market participants should closely monitor shifts in external news, plant operations, and consumer demand recovery for direction in the coming weeks.