The Asian purified terephthalic acid market is stable Friday, despite a plunge in upstream paraxylene and related cotton markets, supported by supply disruptions in India, market sources said Friday.
On Friday afternoon, the CFR China PTA price was pegged at $1,146/mt CFR China, flat from Thursday's assessment. On the other hand, the feedstock PX market sank $29/mt to $1,501/mt, the lowest level in 2012, while September cotton futures plunged Yuan 825/mt ($130/mt) to Yuan 19,685/mt at 2:24 pm Singapore time (0624 GMT).
Market sources said the Asian PTA market was supported as demand emerged in India as Indian Oil Corp. lowered operations its 553,000 mt/year PTA plant in Panipat. The plant's operating rates have been reduced since the end of April due to a catalyst problem and the run rates will likely remain low for some time as the company will only receive a new catalyst after mid-June. The current operating rates were not available.
As a result of the lowered IOC operations, the CFR India PTA price rose $5/mt from the previous week to $1,166/mt.
Market sources said the lower IOC plant operations prompted spot demand in India, which kept the Asian PTA market relatively stable despite the bearish PX and cotton markets. In addition, spot PTA cargoes are limited in Asia to cover India's demand and some traders are seeking spot cargoes in Europe.
According to Platts data, the FD NWE PTA price was assessed at Eur1,040/mt, or $1,343/mt. The freight costs from Europe to Asia are pegged at $45-50/mt.
Meanwhile, the arbitrage window from Europe to Asia is still shut but traders in Asia are anticipating it could open as fresh economic concerns in Europe could slash PTA price there in the coming weeks.
