US PBT Prices Decline in H1 September 2024 Amid Weak Downstream Offtake

In early half of September 2024, Polybutylene Terephthalate (PBT) prices in the U.S. market exhibited a bearish trend, with PBT prices declining by around 1%. This drop in PBT prices was largely attributed to weak demand from the domestic downstream market, particularly in the automotive and electronics appliances manufacturing segments, coupled with limited support from feedstock costs. During the period, prices for PBT feedstock Butanediol surged by approximately 1.3% due to higher raw material costs and unexpected production challenges. Meanwhile, PTA prices declined by about 3%, impacted by weak PX prices amid a soft crude oil market. The return of Libyan crude and additional OPEC supplies, expected as production cuts ease in October, further contributed to the bearish trend in the PBT market. Oil prices fell on September 18th as a Federal Reserve rate cut raised concerns about the U.S. economy, while crude oil inventories fell by 1.6 million barrels to 417.5 million barrels in the week ending September 13, according to the Energy Information Administration (EIA).

During this time, the U.S. market for PBT faced weak demand, particularly in the automotive sector. The National Automobile Dealers Association (NADA) reported that new light-vehicle sales in August reached a seasonally adjusted annual rate (SAAR) of 15.1 million units, down 1.1% from August 2023’s 15.3 million units. Growing vehicle inventory in 2024 drove higher OEM incentive spending, with average spending per unit in August reaching USD 3,035, marking a 59.5% increase compared to the same month in 2023. The average new-vehicle transaction price in August 2024 was projected at USD44,039, a 4.1% year-over-year decline, further contributing to weak PBT demand.

The supply of PBT in the U.S. remained stable, with domestic inventory levels balanced despite reduced demand. No plant shutdowns were reported in September, although the hurricane season caused minor disruptions. Sluggish sales filled warehouses with unsold stock, prompting PBT producers to cut production and offer discounts to reduce excess inventory. Additionally, PBT exports experienced moderate growth, with U.S. plastic resin exports rising by 2.2% in August compared to July, and by 14.9% year-on-year. Overall, U.S. exports in July increased by 8.2% compared to the previous year. Chemical shipments rose by 0.8% in August, marking the seventh consecutive month of growth, with year-on-year growth of 3.8%, which supported PBT exports.

Conclusively, analysts anticipate that PBT prices in the U.S. will remain flat in the coming weeks due to weak feedstock support and moderate downstream demand. The PBT market will continue to face challenges, influenced by both domestic and global economic conditions, keeping the pricing trend stable for the foreseeable future.