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PBT: ESTABLISHED WEAKNESS

July 15, 2019

London (GC Intelligence) — Polybutylene Terephthalate (PBT) Q3 prices in Europe decreased for all grades. GF30 FR was down €40/mt. At the same time, Unfilled and GF30 were both down €100/mt.

PBT prices, along with most other engineering polymers, continue to experience ongoing weakness. Trade tensions have been a major factor that has slowed down demand in 2019. The disputes placed even more downward pressure on an already embattled automotive sector.

Prices were also down because of an increase in competition between suppliers. Because some sellers refused to drop prices, others were willing to do so to gain market share. The impact of this was likely minimal since a switch to other suppliers is not easy for PBT buyers.

At the same time, there was support from extra demand generated from customers that were switching from PA66 to PBT. But so far, the impact of this was also low to non-existent. It was for sure not enough to prevent a price decrease in Q3. While some buyers of PA66 were successful to change to PBT, others were still struggling.

The price decreases posted in Q3 were bigger than expected. At the time of the previous forecast in Q2, a better macroeconomic environment was anticipated in Q3. The assumption was that China and the US would have put an end or at least eased trade tensions. The reverse, instead, took place. The dispute escalated and it continues to keep a cloud of uncertainty on the markets.

Despite the small adjustments between participants, the European PBT market is weak and prices are under pressure. It is likely that this downward trend will remain in place for the rest of 2019.

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