This Week, PET Bottle Chip Spot and Futures Prices Move Downward in Tandem in China

May 15th, News

I. Price Trends This Week (May 12–May 15)

This week (5.12–5.15), the spot and futures prices of polyester bottle chips in East China fluctuated downward in tandem. The spot price in East China fell from 9,080 CNY/ton on Monday to 8,850 CNY/ton on Wednesday and Thursday, a cumulative decrease of about 230 CNY/ton. On Friday, it slightly rebounded to 8,800-8,900 CNY/ton. The main futures contract PR saw a significant drop during the week, reaching a low of 8,078 CNY/ton on Thursday, and slightly rebounded at the end of trading on Friday. Overall, it showed a weak trend of "initial stability, followed by a sharp decline, and a slight recovery at the end." Trading was light, with mainly small orders driven by rigid demand, and the market sentiment was characterized by a strong wait-and-see attitude.

1) Spot (mainstream in East China, tax included, ex-factory)

•5.12: 9,080 CNY/ton (-20)

•5.13: 8,850–9,000 CNY/ton (-50 to -150)

•5.14: 8,850 CNY/ton (-150)

•5.15 (midday): 8,800–8,900 CNY/ton (slightly stabilized)

2) Futures (PR main contract, Zhengzhou Commodity Exchange)

•5.12: 8,372 CNY/ton (-8)

•5.13: 8,302 CNY/ton (-80)

•5.14: 8,078 CNY/ton (-274, -3.28%)

•5.15 (14:42): 8,192 CNY/ton (+52, +0.63%)

2. Core Market Analysis

1) Cost side: PTA continues to weaken, and cost support is loosening.

•PTA: Spot price is about 6,630 CNY/ton, down more than 3% from the beginning of the month. The decline in crude oil prices has led to a weaker PX market, which in turn has caused PTA prices to fall and the cost of bottle-grade PET to decrease.

•MEG: Trading in a narrow range at lower levels (around 4,875 CNY/ton), with limited downward impact on bottle flakes.

2) Supply side: Stable production, high profits, and inventory beginning to accumulate

• This week’s production totaled approximately 330,800 tons, with a capacity utilization rate of 71.44%, unchanged from the previous week.

• Production gross profit is approximately 1,121 CNY per ton, at a high level in recent years, leading to high production enthusiasm among manufacturers in China.

• The number of days of in-stock inventory available at the factory is 8.86 days (compared to 5.73 days last week), indicating a significant increase in inventory compared to the previous week.

3) Demand side: End of peak season, subdued domestic demand, and declining exports.

• The traditional peak season from March to May is coming to an end, and demand is gradually tapering off.

• Downstream beverage/sheet production is operating at 80%–90%, but there is no stockpiling, only small orders for immediate needs, and resistance to high prices.

• Export orders have declined, with FOB Shanghai mainly at $1,190–1,235 per ton, and quotations continue to decrease.

4) Market sentiment: predominantly pessimistic, with strong wait-and-see attitude.

•Trading was light, with stable but slightly declining prices, and the average production and sales ratio was about 59%.

•Futures plummeted, hitting confidence, and downstream purchases were cautious with few actual orders.

III. Technical Analysis

According to the commodity market analysis system, when the 10-day moving average is above the 20-day moving average, the probability of an increase is higher. Conversely, the probability is lower. Starting from May 7th, the 10-day moving average began to turn downward and approach the 20-day moving average, increasing the probability of a decline.

As shown in the figure, this week's decline also confirms the accuracy of the core principles of spot market analysis in China.

IV. Outlook for the Future Market (Short-term: 1–2 weeks)

• Trend judgment: Mainly weak fluctuation, with cost support at the bottom.

•Key price levels: The spot market finds support around 8,700 CNY/ton, with resistance above at 9,000–9,100 CNY/ton; the futures market has psychological support at 8,000 CNY/ton, and short-term resistance at 8,300 CNY/ton.

• Core variables: PTA price, crude oil volatility, downstream restocking pace, and changes in export orders.

Overall, under the combined influence of weakening costs, the end of the peak season, loose supply, inventory accumulation, and a bearish sentiment, polyester bottle chip in China is expected to remain in a weak oscillation for the next 1-2 weeks, with the possibility of further small declines; however, cost support, underlying demand, and expectations of periodic restocking are still present, limiting the space for a significant drop. The more likely scenario is a "slow decline—bottoming out—small rebound" pattern.