[pbt daily review] weak raw material support and soft demand lead to low-level market negotiations

1. Today’s Summary

Domestic PBT spot negotiations shifted lower, with the upper end of quotations for medium- and low-viscosity pure resin in East China revised downward, while the overall market remained characterized by low-level transactions.

On the supply side, the number of units undergoing maintenance has increased. Two production lines at Kanghui New Materials have entered maintenance cycles, and several other companies have reduced operating rates or suspended production. However, overall output has edged up slightly, with capacity utilization remaining around 50%.

The trend of upstream raw materials is diverging, with PTA experiencing a slight increase while BDO continues to weaken, resulting in insufficient support from overall costs. The industry is in a loss-making state, and downstream purchasing willingness is low.

Weekly data are expected to be bearish; capacity utilization, output, and industry profits are all expected to decline in tandem, and there is a lack of short-term upward catalysts for the market.

II. Spot Market Overview

(1) Spot and Raw Material Price Changes

East China low- to medium-viscosity pure PBT resin is quoted today at RMB 9,200–9,650/ton, with the upper end down by RMB 50/ton and the market center edging slightly lower. On the raw materials side, East China PTA rose slightly by RMB 15 to RMB 6,550/ton, while the upper end of bulk BDO prices fell by RMB 50, now running at RMB 7,700–7,850/ton.

Raw materials as a whole are struggling to provide effective support, and coupled with lukewarm end-user demand, there is greater room for negotiation on high-priced cargoes in the market. Market participants are operating cautiously, with downstream buyers only making small-volume restocking at lower prices, while large-scale stockpiling is absent; actual transactions are mainly small orders for rigid demand. PTA rose intraday before pulling back, with suppliers focusing on shipments while buying interest remained limited; BDO continues to face supply-demand pressure, and the market remains in a weak consolidation pattern.

(II) Unit Start-Up and Production Output

Industry maintenance and production cuts expanded: Kanghui New Materials had two production lines under maintenance; Xinjiang Lanshan Tunhe had two production lines shut down; Wuxi Xingsheng’s 100,000-ton unit was shut down; and Zhejiang Changhong maintained low-load production. Even with output reductions at multiple units, total production in the previous period still reached 22,600 tons, up 1.1% month on month, with capacity utilization at 50.94%. The increase came from higher operating rates at other normally running units, fully offsetting the reductions caused by maintenance; overall supply was not tight.

(III) Weekly Data Preview

Core operating data will be released this week. PBT capacity utilization and weekly output are both expected to decline slightly, though the decreases should be limited. Weekly industry profits remain in negative territory, and profit margins may narrow further, with loss pressure on producers continuing to persist.

III. Price Forecasting

1. Short-term overall market trend judgment

In the short term, the PBT market is expected to maintain a low-level, weak negotiation pattern, with significant resistance to price increases.

Suppressing factors: First, downstream end-user demand is insufficient, order volumes are weak, wait-and-see sentiment is strong, and buyers are unwilling to purchase at high prices; second, the continued oversupply of BDO keeps dragging down overall production costs, and the slight rise in PTA is insufficient to offset the decline in BDO prices; third, the industry is operating at a loss, and there have been no large-scale production cuts or inventory reduction measures, so supply remains stable; fourth, traders are strongly motivated to sell and recover funds, and low-priced selling continues to weigh on the market.

Supporting factors: The adjustment of the geopolitical transportation landscape and the expansion of energy transportation channels are expected to ease the pressure from high long-term feedstock prices; maintenance shutdowns at multiple units have led to a phased reduction in supply, limiting the room for a sharp price decline; some bargain-hunting restocking demand has emerged at low price levels, providing support for the price floor.

2. Forecast of Mainstream Price Range

It is expected that tomorrow the mainstream operating range for medium and low viscosity PBT pure resin in East China will be 9,100-9,500 RMB/ton, with the overall focus continuing to adjust weakly. Other regions will follow East China with synchronized low-level adjustments, and the price difference will show small fluctuations.

3. Risk Warning

If concentrated maintenance shutdowns of BDO lead to tighter supply, a rapid rebound in feedstock prices may slightly improve PBT cost support; if downstream orders for electronics and modified plastics are released in a concentrated manner, higher transaction volumes may help prices stabilize slightly. This article is only a fundamental analysis and does not constitute any trading or investment advice.