Recycled polyethylene terephthalate (R-PET) prices in Asia fell to a record low and may continue trending down with importers in China opting to stay out of the market amid domestic economic weakness. On 4 August, prices of clear/white hot-washed flakes with polyvinyl chloride (PVC) content of 300-1,000 ppm (parts per million) were assessed at $615/tonne CFR (cost and freight) China, breaking the previous historical low of $660/tonne CFR China set in February-March this year, according to ICIS data.
Over a period of nearly three years since ICIS started tracking the R-PET market on 25 September 2012, prices have slumped by 40 per cent. From the start of the year, spot prices of clear/white hot-washed flakes with 300-1,000 ppm PVC content have declined by $155/tonne, ICIS data showed.
Meanwhile, prices of better-quality hot-washed clear/white flakes with PVC content below 100 ppm had also softened considerably since end-July, with offers for Taiwanese material heard at $700/tonne CFR China in the week ended 4 August, down by $60/tonne from the previous week.
Hot-washed green R-PET flakes, which are in tighter supply compared with their clear/white counterparts, also declined to a record low of $525/tonne CFR China in the week ended 4 August, according to ICIS data.
R-PET prices have been tracking the decline in virgin PET prices in Asia on concerns over China´s slowing economy. PET prices are expected to gradually decline in the months ahead due to weak feedstock prices and with demand waning as the peak summer season is ending. China is a key market for R-PET and PET in Asia. Growth in China´s manufacturing sector had stalled in July, with the country´s official Purchasing Managers´ Index (PMI) for the month registering a 50.0 reading, down from the previous month´s 50.2. A reading of 50 and above indicates expansion, while a lower number denotes contraction.
R-PET buyers in the country are shelving plans to import spot cargoes indefinitely. They are inclined to restock from the domestic market on a hand-to-mouth basis until market conditions in the downstream polyester sector improve.