The polyethylene terephthalate price in the UK fell this week despite Lotte Chemical’s force majeure at its Teesside plant remaining in place, according to sources.
Lotte Chemical declared force majeure at its PET facility in Teesside in late May, citing a production issue. It operates two lines at the site.
The new 200,000 mt/year line was taken offline, while the old line with capacity of 150,000 mt/year was unaffected.
Lotte restarted production in late June and although operations and delivery patterns are returning to normal, force majeure has not been lifted.
One UK trader said he sold extra volumes this week. He added that he thought customers who had wanted to buy from Lotte had bought from him for July instead, suggesting some buyers had looked outside of Lotte for their purchases.
Despite a tightening in the UK market in June and the force majeure remaining in place, the UK spot price fell further this week.
Platts assessed the UK bottle-grade PET spot price at GBP758/mt ($1,174/mt) FD UK in its last assessment Wednesday, easing GBP7/mt ($10.8/mt) week on week.
In fact, the price has been falling throughout June, declining from GBP810/mt ($1,255/mt) May 27.
The decrease in June has been attributed to weak demand.
Although buying appetite improved marginally in July and Lotte’s force majeure remained, the spot price continued its downward path.
A buyer in the UK acknowledged the drop in the price to GBP755-760/mt this week, from GBP760-770/mt last week.
“[Lotte’s] situation seems to have had no reflection on the pricing situation,” the buyer said Thursday.
Sources expected the spot price to further fall in July.
“I expect an erosion in prices,” the trader said, adding recent falls in the oil price had turned sentiment bearish.
“Lotte returning to [full] production may lower prices,” another trader added.
– Platts.com
