The price of Paraxylene for the October 2023 contract in Europe saw a decline of USD 50/MT compared to September. This drop can be attributed to a combination of factors, including lower raw material prices and decreased demand. The root cause of this situation lies in the crisis affecting the refining markets, where weak demand has led to reduced productivity. Notably, the Indorama Ventures Purified Terephthalic Acid (PTA) plant in Sines, Portugal, had to be mothballed due to these challenges. Furthermore, the news of temporary anti-dumping duties imposed on Polyethylene Terephthalate (PET) imports from China has added urgency to contract negotiations in 2024 throughout the supply chain. As of November 2023, the price for Paraxylene has stabilized, remaining unchanged from the previous week's level as of October 27, 2023.

In the downstream sectors, the European Commission has recently introduced a series of proposed temporary duties as part of their ongoing anti-dumping investigation, specifically targeting imports from select PET producers located in China. In order to maintain transparency and fairness in international trade, detailed information regarding provisional anti-dumping duties will be provided to all manufacturer-exporters who were subject to a separate investigation. However, the ramifications of these proposed anti-dumping duties have not gone unnoticed in the market for Paraxylene as a feedstock.

While there has been some optimism in the Paraxylene market surrounding potential demand growth from the Polyester industries, this positive outlook appears to have been somewhat tempered by the prevailing uncertainties. The overall picture regarding Paraxylene demand in the Polyester sector remains somewhat hazy as the market grapples with the complexities introduced by the European Commission's proposed anti-dumping duties and the broader economic climate.

On the supply side, there was less requirement for Paraxylene as a feedstock due to the reduced operating rate of PTA and PET resin plants. This decline in operating rates is driven by the traditional low-demand season for gasoline in the Northern Hemisphere, which is expected to persist for an extended period. Concurrently, the chief economist at the Hamburg Commercial Bank reported that companies operating within the market are actively engaged in reducing their inventory levels.

Additionally, in terms of output, nearly all major Eurozone member states have experienced a contraction in their manufacturing sectors. As the worst performer among these economies, Germany saw its manufacturing PMI reach a five-month high but still outpaced its peers in the decline.

In conclusion, ChemAnalyst predicts that the price of Paraxylene may fluctuate in the coming weeks with the increased demand from the polyester industry. Meanwhile, with the reopening of PTA plants in the Asian market, the demand for Paraxylene is expected to rise from production units. However, manufacturers must pay extra attention to the changing Naphtha and Paraxylene spreads, which will likely play a major role in changing Paraxylene prices in the forthcoming weeks.