Polyester Market Summary (Feb 16-28, 2011)

● The domestic commodity futures market was depressed by the policies and the ICE cotton futures market fell from high. PTA spot market slightly weakened in the second half of Feb with the support from supply tightness. The import market was relatively firm. Although the prices inched down, the overall profit of PTA industry remained good. MEG market also declined a little affected by weaker commodity futures market, but the strong demand from polyester plants and actively buying of traders supported the market.

● PET fiber chip consolidated at high level. Prices ticked down at first and then rebounded on rising PTA futures. However, actual trading prices were chaotic.

● As downstream market took a slow recovering pace due to various issues, PFY market basically shivered with small price increases. PFY sales basically kept moderate and warmed up obviously when downstream plants replenished their stocks. Downstream O/R returned to a normal level around Feb 22 and PFY market continued a correction period.

● In H2 Feb, direct-spun PSF market gradually softened. PSF price Moved down by 300yuan/mt and its sales stayed slim. Discounts came into sight and PSF O/R slightly cut down due to units’ turnaround.

● PET bottle chip prices were basically maintained during H2 Feb. Prices slipped a little in the last week but then rebounded somewhat on Feb 28. Export market was stable with some minor fluctuations; export trades were not bad as a whole in Feb.