Polyester Prices Rising
The prices of man-made fibers intermediates were largely governed by the volatile crude oil values in 2006. Oil prices rose significantly by 18-20% during the year. This was over and above the 36-40% increase recorded in 2006. The surge is attributed to geo-political issues and unrest in the middle-east, supply disruption in Nigeria and speculation over sanctions on Iran who is pursuing a nuclear programme despite global opposition.
Naphtha, the basic feedstock for all fiber intermediates, mirrored the movement of crude oil prices. They rose by 15% during 2006 in Asia and Europe. In Asia naphtha averaged US$582 a ton. This rise was clearly reflected in prices of olefins and aromatics which were occasionally in short supply. Prices of fiber intermediate raw material via ethylene, Paraxylene and propylene rose in tandem with energy prices. During the year prices of ethylene rose 24% and Paraxylene by 25%.
The significant rise in feedstock prices had an impact the downstream polyester intermediates in Asia but not in Europe. Prices in the polyester segment rose significantly. PTA prices rose 95. in Asia. MEG prices were up 3%. This led to changes in the polyester fibers and yarns segment. However, price rise was limited due to weak demand from consumers. PSF and PFY prices rose by 5% in Asia and by 3% in Europe.
They average US$1.24 a kg of PSF in Asia and Euro 1.45 a kg in Europe. The rise was significant in the third quarter of 2006 both in Europe and Asia. They touched a high of US$1.39 a kg in Asia and Euro 1.55 a kg in Europe in September 2006. However, as the year came to a close, PSF prices were ruling at US$1.31 a kg in Asia and Euro 1.53 in Europe.
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