The German PTA market, a key player in the European chemical industry, has witnessed a significant downturn in prices during April 2024. This decline was attributed to lackluster demand stemming from a downstream sector including PET bottles that utilize PTA for various applications. In the meantime, not only the low enthusiasm from the consumer end but also the low production costs for PTA have altogether declined with the trend.

The Purified Terephthalic Acid prices have deteriorated by 4.5% to settle at USD 860/MT, FD Hamburg, Germany throughout April 2024 amidst the muted demand from end-use industries, including beverage bottling. Consumer enthusiasm for these products has waned, likely due to earlier shipment delays. This has resulted in a backlog of unsold inventory, causing bottlers to hold off on additional PTA purchases. While there was a glimmer of hope in early March when downstream PET producers like Alpek UK, Equipolymers, and Polisan restarted their production lines, this uptick wasn't enough to counter the overall downward trend. This restart signaled a potential recovery in upstream PTA demand, but it was insufficient to offset the existing surplus. Abundant supply also played a significant role in the price decline. With more PTA readily available than needed, producers found themselves in an unstable position. Raising prices could push customers towards cheaper imports, further eroding their market share. Moreover, producers in the derivative markets were focusing on fulfilling existing consumer demand for their products resulting in a less immediate need for additional PTA. In the meantime, the feedstock prices including Propylene and Paraxylene have also declined during April which further eased the accessibility to acquire the raw material at a cheaper cost. As a result, domestic PTA prices in Germany, and across Europe, have been on a downward trajectory throughout April.

In response to these changing market dynamics, European PTA producers, including those in Germany, have been forced to adapt their pricing strategies. This involves carefully considering the shifting demand patterns alongside other economic factors as producers need to adjust their quotes to remain competitive and attractive to customers, all while ensuring their profitability in the long run.

As per ChemAnalyst, the PTA market in Germany is expected to rebound during May on the onset of peak transition bottling season. As spring transitions to summer (April to May), bottled water producers typically ramp up their distribution efforts which could strategically shift away from bulk distributors and towards supplying supermarkets, retail stores, and other outlets directly accessible to consumers. This might help to ramp up the subdued demand for PTA during this timeframe.