Polyester Bottle Flakes Prices on the 27th Show a Noticeable Weakening, with Price Declines Wider

February 27th, News

As of February 27, according to price data, the mainstream average price of polyester bottle chip in East China was 6,275 CNY/ton. Today's price has clearly weakened, with the price decrease expanding.

Core influencing factors

I. Cost Side: Support weakens, and price center of gravity shifts downward (core negative factor)

Crude oil weakens, and the cost foundation loosens.

Expectations for U.S.-Iran nuclear talks are rising, easing geopolitical risks; however, the U.S. has raised import tariffs and Venezuela has resumed crude oil production, putting downward pressure on crude oil prices in the short term.

The decline in crude oil prices directly weighed on PTA/MEG, causing both PTA and MEG to weaken simultaneously. Cost transmission is now clear, and the cost support for bottle flakes has weakened.

II. Supply Side: Start-up levels are moderate, and inventories remain relatively low, but the weak trend is hard to reverse (neutral to bearish).

1. The operating rate is moderate, and the supply is stable.

The operating rate of bottle flake plants is about 66%, lower than the same period last year (75%+), and supply is not significantly oversupplied.

New production capacity is limited (with plans to expand by only 700,000 tons in 2026), and overall supply pressure remains manageable.

2. Inventory is low, but weak demand makes it difficult to reduce stock.

Factory inventories are low, and there is no pressure from concentrated selling.

But downstream buying interest is weak, inventory depletion is slow, and factories still have the motivation to reduce prices to increase sales.

III. Demand Side: Recovery Falls Short of Expectations, Buying Momentum Remains Weak

1. Downstream operations are recovering slowly, and there is insufficient rigid demand.

The resumption rate for downstream industries such as soft drinks, sheet products, and edible oils is only 50%–60%, significantly lower than the same period in previous years.

Downstream sectors are mainly focused on digesting pre-holiday raw material inventories, with few new orders and cautious purchasing, limited to small orders for immediate needs.

2. Production and sales are sluggish, with low transaction volumes.

Today, the production and sales of bottle chips in China are only around 30%, far below the break-even point (70%+), putting significant pressure on factories to sell their products.

Bid-ask spread widened (50-100 CNY/ton), with most transactions at lower prices, putting pressure on mainstream quotations in China.

3. Peak season expectations are still there, but it's hard to realize in the short term.

In mid to late March, which is traditionally a peak season, demand is expected to gradually recover, but there are currently no clear order signals, and the market is mainly in a wait-and-see mode.

It is believed that the weakening of crude oil + PTA/MEG on the cost side, and the slow resumption of work and low sales in the downstream sector on the demand side, coupled with a leading decline in futures, have collectively led to a weak fluctuation in today's bottle chip prices. The low inventory on the supply side provides limited support but is difficult to offset the dual pressures of demand and cost. In the short term, it is expected that prices will remain in a weak consolidation, with little chance of a significant rebound. Attention should be paid to the trend of crude oil, the progress of resumption of work in the downstream sector, and the prices of PTA/MEG.