US PBT Prices Stabilize on a Softer Note in June 2024 Amid Low Demand

Polybutylene Terephthalate (PBT) prices in the US market stabilized in June 2024. However, on a weekly basis, PBT prices fluctuated within a narrow range due to imbalanced supply and demand dynamics. Monthly, PBT prices showed steady performance with a minor reduction of around 0.2%. This trend in PBT prices is driven by moderate consumption and a soft feedstock market. Key raw materials saw significant price changes, Butanediol decreased by approximately 12.8%, and Purified Terephthalic Acid (PTA) slid down by about 1%. The decline in Butanediol prices was attributed to a temporary slowdown in the US market and reduced demand in its downstream market. Meanwhile, the reduction in PTA prices was due to sufficient inventory and slightly lower offtake from the downstream market.

PBT prices remained stable despite logistical disruptions due to unrest in the Red Sea and moderate procurement activities in downstream sectors. However, recently the automotive industry experienced a slight increase in PBT demand. Data showed a positive trend from the downstream automotive manufacturing industries, with new vehicle sales in the US surging by approximately 8.8% in May 2024 compared to the previous month and increasing by around 5% compared to the same month previous year. Additionally, crude oil prices declined after the U.S. Energy Information Administration reported an inventory increase of 3.6 million barrels for the week ending June 21st. This followed the previous week's draw of 2.5 million barrels, which had pushed prices higher due to concurrent declines in gasoline and middle distillate inventories, suggesting stronger demand. This substantial inventory buildup in crude oil led to balanced prices for its derivatives, including PBT feedstocks, resulting in a balanced trend for PBT prices.

In terms of supply, stable PBT production capacities and consistent feedstock availability contributed to this equilibrium. Despite global supply chain challenges, such as fluctuating freight rates and logistical disruptions, PBT manufacturers in the US maintained steady output levels. This supply stability bolstered market confidence and ensured predictable pricing dynamics for PBT resin, catering to diverse industrial applications. However, US container import spot rates from North Asia and Southeast Asia hubs reached their highest levels in nearly two years, partly due to diversions in the Red Sea causing significant capacity issues in East Asian shipping lanes. On June 7, shipment rates from East Asia to the West Coast of North America increased by 17%, and by 11% for East Coast imports. Conversely, exporters experienced a freight reduction of 8.5% for shipments from the North American West Coast to East Asia and around 5% for exports from the East Coast.

Conclusively, PBT prices remained unchanged in the US market. However, analysts anticipate that PBT prices may increase in the beginning of Q3, to be driven by the demand from the downstream industries.