For the Fourth Quarter of 2021
In October 2021, dimethyl terephthalate prices rose sharply due to rising demand from the domestic market and low output levels throughout the market. For paraxylene, one of key raw materials of DMT, India relied significantly on imports from China and other far East Asian nations. Ex-Ahmedabad, paraxylene costs were estimated to be 137770 INR/MT. Due to a downturn in demand in the domestic market, PX market sentiment weakened in the second half of Q4. Demand from the Purified Terephthalic Acid (PTA) market bolstered the upstream PX market in China, but as the quarter progressed, market sentiment worsened. This affected dimethyl terephthalate prices as well.
Upstream PX manufacturers had high profits during the fourth quarter thanks to a healthy PET market. As a result of the heightened market activity, strong bullish prices for paraxylene emerged. On FOB basis, dimethyl terephthalate prices climbed from 925 USD/MT in October to 1055 USD/MT in December 2021. Throughout the quarter, energy input costs remained high, pushing up overall production costs and resulting in significant price increases for DMT.
The North American paraxylene market started the fourth quarter on a high note, thanks to rising demand for PTA, a precursor for PET bottles. PX prices in the United States surged to 989 USD/MT FOB Texas in October, but demand degradation in the second half of the year significantly impacted market sentiment, and prices fell to 865 USD/MT in December. Traditional consumption decline in lieu of the winter holiday season contributed to the drop in demand.
For First, Second and Third Quarters of 2021
Due to restricted spot availability of upstream products and various plant shutdowns recorded in the region during the Chinese Lunar New Year holidays, supplies of the feedstock paraxylene were tight in the Asia Pacific during Q1 2021, resulting in a total loss of 480,000 tonnes of output. In March, numerous companies including Sinopec (East China), Zhejiang Petrochemical, Sinopec Yangtze, CNPC Sichuan, and others were temporarily offline, contributing to inventory constraints and raising offers. In March, dimethyl terephthalate prices in China increased by 23.9% on a month-over-month basis, to 173 USD/MT, due to a worldwide supply deficit. The market's mood was boosted by strong demand for Chinese PX from the United States.
On the strength of growing demand from downstream manufacturers, the APAC paraxylene market saw moderate recovery in the third quarter of 2021. After a period of continuous weekly reductions in August, prices began to rise in September. In September, Sinopec refineries in China reduced throughputs in response to 'dual cutbacks' in energy consumption and carbon emissions in several areas, such as Jiangsu province in eastern China. The province's Sinopec Jinling Petrochemicals cut its run rates by around three percentage points in August, affecting PX prices in the region during Q3. After the ease in pandemic cases in India, there has been a small rebound followed by a comeback in economic operations. In September, the ex-Mumbai price of paraxylene was estimated to be 1685 USD/MT.
During the first quarter of 2021, supplies in the European region were limited due to decreased operating rates of refineries in the northwest European region due to cold weather conditions, followed by a fall in imports from the United States, which further constrained market supply. Offtakes from the downstream PTA industry boosted demand. Some market players were hopeful that product fundamentals had improved in the previous year and that the bullishness would endure at least through H1 2021. During the third quarter of 2021, the general market forecast for paraxylene in Europe was viewed as tight. After experiencing logistical challenges early in the quarter, supply fundamentals improved as imports from Asia lessened. FOB Hamburg offers declined from 900 USD/MT in July to 890 USD/MT in September, indicating a downward trend in Germany. In Q3, the downstream PTA industry experienced a rise in demand.
The North American paraxylene supply remained tight in the first quarter of 2021, owing to production interruptions induced by the arctic freeze that slammed the US gulf region, suspending 73 percent of the region's total paraxylene capacity and resulting in worldwide supply constraints. Due to the lack of paraxylene, demand from the downstream PTA and PET industries soared. Dimethyl terephthalate prices increased dramatically in the North American, with April delivery prices estimated to be about 895 USD/MT, up 205 USD/MT from February delivery rates. In the third quarter of 2021, the general demand picture in the North American domestic market remained unclear. The majority of production was shut down throughout the first part of the quarter, although several critical ports and waterways reopened in the first week of September after Hurricane Ida hit the US Gulf coast, causing massive damage and power disruptions. Despite the suspension in raw material production, the supply of paraxylene remained stable. Given the high input volumes from the packaging sector in the wake of the US economic recovery, downstream PTA demand was strong in Q3. During the third quarter, feedstock prices were estimated to be 940-980 USD/MT FOB Texas.
For the Year 2020
Because of the planned maintenance turnarounds at various PTA factories, demand for the Asian paraxylene steadily declined due to dull offtakes for the derivative PTA. Due to the weak production margins observed by end-use sectors, manufacturers were heard operating at a lower pace than the previous quarter. In the quarter ending September 2020, the resumption of operations at some factories in the manufacturing hub China, such as Dongying Weilian Chemical and Sinopec Hainan, added to the pressure on the market fundamentals of paraxylene.
Due to an unforeseen outage in one refinery followed by a maintenance turnaround in another refinery, market sentiment for the raw material remained positive. The scarcity of aluminum boosted demand for PET bottles and containers, boosting demand for paraxylene. However, a sudden scarcity of the co-feedstock MEG for PET manufacturing, along with a series of extended turnarounds conducted in the wake of Hurricane Laura, produced a backlog in PET production, decreasing paraxylene profit margins.
In Q3 2020, the market for paraxylene was dull due to abundant supply and depressed demand in the area due to weakening PTA. The vendors had little room to extend their profit margins due to plentiful product inventories. Few European companies were observed adopting output cutbacks to help the lingering fundamentals, but it was clearly insufficient to lift emotions. Spot operations were severely limited due to low regional demand, as purchasers were hesitant to acquire large volumes due to the current demand uncertainties.
Procurement Resource provides latest prices of Dimethyl Terephthalate. Each price database is tied to a user-friendly graphing tool dating back to 2014, which provides a range of functionalities: configuration of price series over user defined time period; comparison of product movements across countries; customisation of price currencies and unit; extraction of price data as excel files to be used offline.
Procurement Resource provides prices of Dimethyl Terephthalate for several regions around the globe, which are as follows:
About Dimethyl terephthalate:
The chemical compound dimethyl terephthalate is a diester made up of terephthalic acid and methanol. It's a white solid that melts into a colourless liquid that may be distilled.
The disproportionation procedure is the method used to make DMT. ExxonMobil PxMax is comparable. As an intermediate, p-xylene is produced. After that, P-xylene is oxidised, combined with methanol, and lastly esterified to form DMT.
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