Polyester Market Summary (Mar 16-31, 2011)

● During the reporting period, PTA prices gained certain increase previously but then turned down. China announced on Mar 31 to tighten foreign exchange management and affected market sentiment greatly. MEG market also stayed in deadlock with dropping prices and weak transactions. Polyester plants with high inventory mainly held wait-and-see sentiment and purchased sources cautiously.

● PET fiber chip market continued stable. Market sentiment was plain and transactions were moderate. Looking-on sentiment strengthened in month end as feedstock weakened and PFY plants provided more discounts. Trade was mainly from rigid demand.

● Despite supports from high costs, PFY market kept weak due to high product inventory and hesitant buyers. Sales presented moderate. Downstream power ration also added some pressure on market confidence.

● In H2 Mar, direct-spun PSF market gradually softened, down by 450yuan/mt. PSF trading sentiment stayed sluggish, with discounts in trading. PSF plants slightly cut down operating rates due to high inventory.

● PET bottle chip market was basically stable. In domestic market, prices began to weaken in the last few days of this month as feedstock softened. In export market, supported by abundant orders and high feedstock, offers were maintained. But prices dipped a little in month end.