US PET costs were expected to increase in August with PET resin prices also expected to increase, industry sources said.
"We don't have a (bottle resin) increase yet but we're aware of the situation," a producer said.
The situation was a potential loss of margin if no increase is announced for August.
PET producers typically issue price increases 15 days before the month they are to be implemented, but raw material prices have been so volatile over the past few months that this practice has slowly been abandoned.
"We can issue an increase anytime," the producer said.
MEG contracts were expected to decrease about $50-60/mt following lower Asia Contract Price announcements that are used in US fiber grade formula contracts. The MEG decrease would amount to about a 0.85 cents/lb drop in costs per pound of PET.
Paraxylene costs, however, were expected to stage a rebound from July's 5 cents/lb decrease. The US PX CP tends to follow changes in the Asia contract market. July's Asia Contract Price, for example, was down $100/mt (4.54 cents/lb) at $1,400/mt and the US PX CP settled down 5 cents/lb.
Asia's spot PX price has since climbed over $1,500/mt which means the ACP has support to settle $100/mt higher and pull the US CP up 5 cents/lb with it.
A potential 5 cents/lb increase in PX would be about a 2.91 cents/lb increase in costs. Combined with MEG, total PET costs would be up roughly 2 cents/lb. If PET producers do not issue a price hike they would be forced to accept a loss of margin.
