Insight Focus
PET and PTA Futures slipped back last week, as concerns on prolonged PTA maintenance eased. Chinese PET resin export prices keep flat; PET Futures premium over Raw Materials Futures compressed. Chinese PET resin export margins to face downward pressure in Sept, although prices see raw materials support.
PTA Futures and Forward Curve
PTA Futures fell back last week, following the previous week’s volatility around Hengli’s unexpected shutdown. Sept’25 main month contract slipped by 2.7% versus last week’s close.
Crude oil prices remained volatility, ebbing back and forth on fresh attacks and negotiations in Ukraine. By Friday’s close, Brent crude oil prices remained relatively on-par versus the previous week at USD 67.5/bbl.
Overall, crude market sentiment remains bearish on an expected rise in OPEC+ supply and weaker seasonal demand from September leading to increased global oil stockpiles in coming months.
According to a survey compiled by The Wall Street Journal, major investment banks, including Goldman Sachs, Morgan Stanley, and JPMorgan, see Brent Crude prices averaging USD 63.57/bbl in Q4’25.
In addition to Hengli’s expected extended maintenance, several other PTA plants also shutdown last week. However, this was at least partially offset by Sanfame’s new 3.2 million tonne project being brought online. Overall, PTA operating rates declined to around 70%, supporting fundamentals.
Looking forward, PTA margins will continue to see support during this maintenance period, and seasonal downstream demand in the run up to October. However, the PTA SD balance is expected to weaken again in Q4 as both drivers reverse, and stocks accumulate.
The PTA forward curve has steadily moved into slight contango; the Jan’26 contract has a RMB 56/tonne premium to the current month’s contract, and Mar’26 with a RMB 96/tonne premium.
MEG Futures and Forward Curve
MEG Futures remained relatively flat, in comparison to PTA. Main month contracts moved by less than a fraction of a percent in either direction, keeping to a relatively narrow range.
East China main port inventories continue to fall, dropping 6.8% to just 475k tonnes, on limited arrivals. Expectations are for stocks to continue to decline through H1 Sept.
Although domestic MEG operating rates have risen over recent weeks, fewer deep-sea arrivals and increasing demand from downstream polyester has lent support to the MEG SD balance, and is expected to continue to do so through to mid-Oct.
The MEG Futures forward curve kept unchanged with the Jan’26 holding just a RMB 41/tonne premium over the current month, and the Mar’26 holding a RMB 27/tonne premium.
PET Resin Export – Raw Material Spread and Forward Curve
Chinese PET resin export prices kept steady with prices flat at USD 780/tonne versus the previous week.
The average weekly PET resin physical differential against raw material future costs decreased USD 4/tonne to USD zero/tonne last week. By Friday, the daily differential was at positive USD 6/tonne.
The raw material cost forward curve showed a slight increase in forward premium, with Jan’26 at a USD 8/tonne premium with current month, and May’26 holding just a USD 15/tonne premium.
PET Resin Futures and Forward Curve
PET Resin Futures also softened, with main month contracts down by an average of 1.5%; Sept’25 contract months fell the most by 1.79% versus the previous week.
The current main month fell to RMB 5832/tonne (USD 818/tonne), down by just USD 15/tonne from last week (inc. FX adjustment).
The average weekly premium of the Sept’25 PET Futures over Sept’25 Raw Material Futures fell sharply to USD 38/tonne, down by USD 11/tonne. By Friday, the daily premium had rebounded from the mid-week lows to stand at USD 44/tonne.
The PET Resin Futures forward curve moved into slightly more of a contango; Jan’26 was at a RMB 138/tonne (USD 19/tonne) premium over the current month; Mar’26 had RMB 174/tonne (USD 24/tonne) premium.
Concluding Thoughts
Chinese PET resin export prices at the end of summer are at a standstill, supported only by producers’ willingness to sacrifice operating rates to keep from moving into loss.
Chinese PET resin operating rates remain depressed. No additional shutdowns are planned, and some lines that were placed into maintenance weeks ago may be gradually brought back online over the next month.
At the same time, resin demand has reached the beginning of offseason and any increase in supply will compress profitability further. Around 600 thousand tonnes/year of new capacity is also expected to be brought online in September, although this may face delays.
Looking forward, Chinese PET resin export prices face support from raw materials, buoyed by polyester demand, through to mid-October. However, PET resin margins and the physical differential to raw materials is expected to follow a typical seasonal trend of slipping lower in September.
For PET hedging enquiries, please contact the risk management desk at MKirby@czarnikow.com.
For research and analysis questions, please get in touch with GLamb@czarnikow.com.
