Crude oil: Crude Crosses US$80 a barrel

OPEC’s Secretary General Abdullah al-Badri opined that oil prices at around US$80 were a bit high given the state of the world’s economy. OPEC could consider raising output targets when it meets in December, but only if inventories declines and there was ‘real economic growth.’ By the end of this week WTI for December delivery was up 2.5% or US$1.97 at US$80.50 a barrel on the Nymex while the European Brent for December closed at US$78.92 a barrel, up US$1.93 (2.5%) from the closing of the previous week.

Polyester Chain: PFY and PSF Prices Up
Ethylene prices rose across markets influenced by firm upstream crude oil and naphtha markets. In NE Asia, unexpected shutdown of a unit pushed prices to up at end-September level while tightening of supplies in SE Asia spiraled prices. Demand for ethylene suddenly swelled in SE Asia as Shell Chemical is expected to start its MEG unit in Singapore by end-October. Prices in USA too increased while they sobered in Europe. Paraxylene prices weakened a bit in Asia after spurting a week ago following downstream PTA sentiment. MEG and PTA prices sobered a bit in Asian markets after rising last week. The rise was too high in MEG to continue this week although ethylene prices rebounded to late September levels. The sobering of PTA and MEG prices did not deter prices of PET-chip to rise further in China and Taiwan. The rebounding of polyester filament yarn market pushed prices for semi-dull PET chips up. Polyester filament prices market sentiments improved and sales/production ratio was higher than previous weeks. However, prices saw mixed trend across markets of China, Malaysia/Indonesia, and Pakistan. Polyester staple fibre prices were up in China while they were steady in other markets of India, Pakistan and Taiwan rolling over previous week’s numbers.

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Nylon Chain: Prices up across
Benzene prices continued to rise across markets influenced by tight supply in Asian markets. The cutbacks led to tight supply for spot benzene and exports to the West and Middle East reduced availability in Asia. Caprolactum prices increased significantly as Chinese buyers returned to the market pushing demand for spot cargoes. The situation was aggravated by shutdowns and turnarounds. Nylon chip prices were strongly influenced by bullish benzene and CPL prices in China. Downstream spinners showed active buying interest and trading volume increased. The spur was also caused by China’s anti-dumping measures on imported nylon 6 chips. Nylon prices increased in China as demand spurted post National Holidays. Feedstocks too were dearer forcing filament producers to raise prices amidst improving demand.

Acrylic Chain: Feedstock Firms Up
The rise in propylene price continued across markets as crude oil price remained firm and buyers hurriedly replenished inventories on worries of tight supply. Upcoming cutbacks at steam crackers would reduce production of propylene accordingly. Nevertheless, Asian acrylonitrile prices softened a bit despite tight spot supply. Downstream demand for acrylonitrile was quiet as acrylic fiber production started declining since early October. Acrylic staple fiber market was stable and overall prices were range-bound rolling over previous week’s numbers. Reportedly, producers in China had low inventories with sufficient downstream demand.

Viscose Chain: Slight Rise in VSF Prices
The NBSK Index value for softwood pulp increased US$6 a ton on European market while the same in US market gained US$0.40. In Asia wood pulp supply was limited and offers were firm at previous week’s level. In China, cotton linter prices soared post National Holidays. Second cut linters were dearer by US$30 a ton while cotton pulp staple grade was dearer by US$15 a ton. Viscose staple prices were slightly up in China and Pakistan while they were stable in India. In China, some rayon yarn producers showed buying interest as cotton pulp prices firmed up. Viscose filament yarn prices were stable rolling over previous week’s numbers in China and India. However, weakening of INR resulted in Indian prices lowering by almost 6-10 cents a kg across various deniers. In China, transactions were unsatisfying and in Guangdong market they even declined.

Cotton: Prices Continues to Rise
Prices of cotton prices shot up across markets since mid-week. The Cotlook ‘A’ index was up from 67.80 cents to 69.20 cents a pound. The East Texas and West Texas -OK-color-41, leaf 4, staple 34 gained US cents 2.00 per pound and 1.75 per pound respectively. In China, the cotton index was up RMB281 a ton. The Karachi Cotton Association official spot rate ended up PakRs.175. In India, prices of most varieties increased between INR100-600 per candy.

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