PBT Prices Hold Steady in US While Asian Market Sees Slight Increase Amid Logistic Issues

In early July 2024, the Polybutylene Terephthalate (PBT) prices in the US market exhibited a relatively stable trend with only minor fluctuations domestically, while PBT prices showed a slight increase in the Asian market.

In the US market, PBT prices experienced a minimal rise of about 0.5% during the early part of the month, mainly due to insufficient cost pressure from the feedstock and moderate downstream consumption. Concurrently, the price of feedstock butanediol decreased by approximately 2.7%, driven by weakened demand, which prevented a strong consolidation of the market. Despite this, butanediol production costs remained favorable due to ample supply at the grassroots level, although downstream procurement and exports were limited. This cooler feedstock market allowed traders to maintain their margins without adjusting PBT prices.

Demand for PBT in the automotive sector remained tepid due to ongoing economic uncertainties. Since July 2023, the US Federal Reserve has kept the federal funds rate between 5.25% and 5.50%, a level notably higher than the average over the past decade. However, economists forecast significant rate cuts over the next two to three years, potentially lowering it to between 1.7% and 2.0% by the end of 2026. Recent trends in declining inflation could support this forecast. Furthermore, slower economic growth and a slight rise in unemployment in 2024 may increase the likelihood of the Fed beginning rate cuts sooner than anticipated.

Additionally, North America's light vehicle production was reduced in the early part of 2024 as manufacturers dealt with excessive inventory levels and struggled to balance sales and production. Analysts have also revised their 2025 forecasts down by 1.6% due to an extended inventory correction process.

In contrast, PBT prices in the Asian market saw an increase of around 1% during the same period. This rise was attributed to adjustments made by manufacturers in response to logistical constraints and port congestion at major ports. Production costs for PBT remained balanced as feedstock butanediol prices held steady.

The monthly average price of local PBT saw a modest adjustment, driven by stable feedstock prices and reduced demand. Butanediol's average price was CNY 9,000 per ton, reflecting a slight 0.02% decrease from the previous month. In July, local PBT production rose by 3.03% to 81,500 tons, ensuring an adequate supply of PBT in the region. Despite this, PBT factory operation rates stayed elevated, while downstream demand, especially from the textile sector, was lower due to the typical seasonal downturn.

In conclusion, analysts predict that PBT prices in both regions are likely to remain balanced in the coming weeks due to the softness in the downstream market.