Insight Focus
- Chinese PET exports on track for another record year driven by new capacity additions.
- Lower EU imports in Q3 give domestic producers some breathing space.
- Indian PET resin exports contract, whilst Chinese imports threaten domestic market.
China’s Bottle-Grade PET Resin Market
Monthly Exports
- Chinese bottle-grade PET exports (HS 39076110) reached over 375k tonnes in October, increasing 4% on the previous month, and up 32% from a year earlier.
- Chinese PET resin producers reported a large increase in new order intake in October following the national holiday break, whilst some would have fed into the month’s exports, much is believed to have been for forward business.
- However, PET resin sales are believed to have slowed through November meaning monthly volumes may average themselves out through to year end.
- Nevertheless, 2023 is still likely to be another record year for Chinese exports.
- Indonesia was the largest destination market in October with over 25.4k tonnes, recording large monthly and annual volume increases of 80% and 287% respectively.
- Year-to-date exports to Indonesia are also up nearly 82%, with Indonesia becoming a key target market for new Chinese capacity.
- Despite anti-dumping measures against Chinese resin, India continues to see increasing volumes of PET resin, presumably from Wankai, the one Chinese PET resin producer with the lowest duty structure into India.
- In October, Chinese customs recorded over 23.6k tonnes of PET resin exports destined for India, a monthly gain of 36%, with exports up a staggering 1032% year-to-date.
- The continuing surge of Chinese PET resin into India has already resulted in domestic producers lowering operating rates.
- Latin American destinations also ranked highly in October, with Peru (3rd), Uruguay (5th), and Colombia (6th).
- However, whilst Peru posted a 12% monthly gain, most saw volumes fall in October; Peru and Colombia have also recorded large year-to-date declines of 16% and 31% respectively.
- Although smaller in volume, exports to Chile have bucked this trend increasing 3% on the month, and 7% YTD.
EU Bottle-Grade PET Resin Market
Quarterly Imports
- EU-27 bottle-grade PET imports (HS Code 390761) totalled 247k tonnes in Q3’23, 31% down on the previous quarter and a 24% decrease versus Q3’22.
- Top 5 origins in Q3’23 is ranked Vietnam, Turkey, Egypt, South Korea, and China, representing 80% of total EU imports from outside of the block.
- In comparison to Q1’23, when China was the largest source of EU imports, China has now dropped through the rankings due to the ADD investigation.
- EU PET resin imports from China fell 77% in Q3’23 versus the previous quarter.
- Imports from most major origins experienced declines in Q3’23, with volumes from Vietnam, Turkey, and Egypt, decreasing 22%, 4%, and 28% respectively versus the previous quarter.
- Conversely, South Korean imports gained 21.6%, to over 27.6k tonnes, up 116% for the nine-month period.
- Despite the provisional set of ADD against Chinese resin being published at the end of October, lower barriers to entry for a couple of producers, including Sanfame and Wankai, leaves the door open for a future increase of Chinese resin into the EU trade block.
Quarterly Exports
- Extra-regional EU-27 PET resin exports experienced a modest decline in Q3’23, down 2% versus the previous quarter to around 53.7k tonnes, with European operating rates remaining under pressure.
- The UK remained the largest destination for PET resin out of the EU block, with exports (under HS 390761) at just over 30k tonnes in Q3’23, down 7% on the previous quarter but up 12% compared to Q3’22, and up 5% in total YTD.
- Other destinations of note in Q3’23 included, Ukraine, Switzerland, South Africa, and Mexico, with exports to Ukraine rebounding to 7.1k tonnes, 38% up versus the previous quarter.
- However, significant YTD declines were recorded for Serbia (-66%), US (-91%), Kazakhstan (-80%).
India Bottle-Grade PET Resin Market
Quarterly Exports
- Indian bottle-grade PET exports dropped back once again to just 84k tonnes in Q3’23, losing 16% versus the previous quarter, half of what was exported a year earlier.
- A combination of a tighter domestic market earlier in the year, and challenges competing with lower priced Chinese resin into core export markets have limited export volumes in 2023.
- Due to the level of protection against Chinese resin, Japan remained the largest destination for Indian resin with 6.9k tonnes in Q3’23.
- Exports to Japan have rebounded sharply over the last year, from almost nothing between Q3’21 and Q2’22. However, 2024 volumes are still up to less than half of pre-COVID levels.
- The next largest export destinations were Israel, UAE, Algeria, and Yemen. Exports to Israel increased 9% to 6.7k tonnes in Q3’23, although levels were still down 45% versus a yearly earlier.
- Volumes to the UAE and Algeria fell sharply in Q3’23, down 49% and 23% respectively. Exports to the UAE have shrunk 40% in 2023 YTD.
Quarterly Imports
- Indian bottle-grade PET imports continued their surge, up an additional 30% in Q3’23 versus the previous quarter, totalling 48.6k tonnes, 66% above levels seen a year earlier. YTD PET resin imports are more than double those seen in 2022.
- As can be seen from the charts, much of the increase has come from China. China remained the largest origin with over 26.2k tonnes in Q3’23, despite anti-dumping duties (ADD) on PET resin imports from China for five years from 27 March 2021.
- Following the introduction of anti-dumping duties against Chinese PET resin into India in 2021, Vietnamese and Taiwanese resin initially filled the import gap. Volume from Thailand and Bangladesh also entered the market in 2022.
- Whilst imports from Taiwan and Bangladesh have shrunk in 2023 YTD, imports from Vietnam leapt 119% in Q3’23 to 13.5k tonnes, 43% the same period a year earlier.
Data Appendix
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