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Low margins push China away from R-PET market

China’s textile makers are said to be moving away from the recycled polyethylene terephthalate (R-PET) market, as their production margins continue to shrink despite falling raw material prices, indicated market insiders.

On November 3, 2015, prices of clear/white hot-washed R-PET flakes with polyvinyl chloride (PVC) content of 300-1,000 ppm (parts per million) flakes were assessed at $575/ton CFR (cost and freight) China, according to ICIS data. Prices have remained soft after hitting $560/ton CFR China – the lowest since ICIS started tracking the market three years ago – on September 1, 2015, the data showed.

According to a downstream Chinese textile manufacturer, the company has stopped production of recycled polyester due to weak margins after considering upstream and downstream conditions. The producer has also stopped making polyester from virgin PET fibre sighting sustainability issues and is focusing on nylon production.

China is a major import market for R-PET flakes with 300-1,000 ppm polyvinyl chloride (PVC) content, which is used mainly in the production of recycled polyester. In September, China’s total R-PET imports were down 8.6 per cent year on year at 173,818 tons, China Customs data showed.

Customs.gov.cn

 
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