Polyester Market Summary (Apr 18-29,2011)

● Influenced by weak macroeconomics and polyester market, PTA market collapsed sharply. Agents and some traders showed obvious intention to sell cargos, though the market was supported a bit by some polyester plants taking offers at the end of the month. Comparing to PTA, MEG market presented relatively firm after consolidating in weakness. As no new units would go into operation and some units may be shut for maintenance in H2, MEG market was still predicted to be favorable.

● PET fiber chip remained weak with prices slipping by 250-300yuan/mt. Transactions were plain amid cautious sentiment.

● As feedstock market fluctuated with dropping prices, PFY market basically kept weak in H2, Apr. Downstream demand remained moderate but lacked speculation. Prices ticked down moderately and inventory declined a bit. As upstream market maintained a bit soft, PFY market may stay in weakness in the short run.

● Direct-spun PSF market continued to move down in H2 Apr, with price down by 300yuan/mt. Its sales kept dull. Sinopec settled Apr PSF contract price relatively high at 14150yuan/mt for semi-dull 1.4D. PSF exported price also followed down. Besides, PSF units O/R slightly enhanced as units in Jiangsu restarted.

● Dragged by weak feedstock, PET bottle chip prices softened in the past two weeks. Mainstream trading level fell by 400-500yuan/mt. Export trade presented sluggish and trading prices dropped sharply by $120-130/mt.