Asian PX prices poised to fall further on weak blending, downstream demand

This content is part of the WPC 2025 series, where we explore key themes from the 40th annual World Petrochemical Conference.

Asian paraxylene prices are expected to decline in coming weeks amid thin US gasoline blending demand, while downstream polyester sales in Asia appear sluggish despite the onset of the peak summer demand season, market sources said March 7.

PX spot prices had been slowly recovering since mid-January amid production cuts in Asia, traders said, although this positive trend seems to be reversing as China's downstream demand and blending demand from the US look increasingly worrisome.

Platts, part of S&P Global Commodity Insights, assessed Asia PX CFR Taiwan/China at $834.33/mt at the Asian close March 7, down $67/mt from the year's highest price of $901.33/mt Jan. 16.

The PX outlook has been hammered by several factors, including the US administration's tariff threats hurting crude prices, lackluster downstream polyester demand in China and the absence of support from gasoline blending demand from the West, a Singapore-based trader said.

"At the moment, gasoline [demand] is very weak [and] I don't see any [signs of] gasoline pulling [PX for blending]," the trader said.

Over the past 2-3 years, demand for aromatics for blending into gasoline significantly boosted spot prices of PX and other aromatics, such as mixed xylene and toluene, while also tightening regional supplies.

However, the arbitrage for MX appeared to have closed in March, and expectations for a repeat of this phenomenon in 2025 are already looking weak, with gasoline demand deemed to have peaked, while US refiners likely have higher stockpiles of blending components from previous years, market sources noted.

Troubled downstream

In addition to blending demand, PX producers were relying on healthy polyester runs in China, especially as the peak summer season fast approaches, a China-based trader said.

However, hopes of summer polyester demand look bland so far, prompting downstream purified terephthalic acid producers to consider turnarounds in the second quarter to rescue margins, the Chinese trader said.

Spot prices could plunge further after May or June when turnarounds end and plants resume operation, the trader added. "The [PX] flat price is already down [and could drop more] because [in] May and June, lots of [PTA plant] maintenance will be completed and supplies will be back."

Europe's poor spot liquidity

European PX demand has remained weak since the beginning of 2025, with little appetite from gasoline blenders and downstream PTA producers. January saw increased demand for blending components in Europe, mainly MX and toluene, while PX remained undesirable.

Platts assessed the M1 March PX FOB ARA spot price at $855/mt March 7, down $5/mt day over day, taking partial direction from the weekly downtrend in the related Asian PX market.

European PX producers continue to highlight the lack of economic incentive to produce PX in Europe, amid PTA plant closures in recent years and thin spot liquidity. Consequently, European PTA and polyethylene players are increasingly interested in referencing Asian PX in contracts.

"We are regularly in talks with suppliers to use Asian PX values in contracts for PTA," a PET producer in Europe said. "There is a lot of focus on the Asian PX market in Europe at the moment."

Many market participants hoped Turkey's commencement of PTA production would help boost spot liquidity in the European PX market; however, recent feedback shows a greater preference for Middle Eastern feedstock.

"[Middle Eastern producers] can manage to place [their PX] within South Asia like India and Southeast Asia. [Turkey's] SaSa is now running and will take away Middle Eastern cargo," the Singapore-based trader said.

Weak US octane demand

In the US, PX is facing significant headwinds amid weak gasoline blending economics and the influx of imported material.

Platts assessed prompt spot PX at $890.08/mt FOB USG March 7, 16 cents/mt higher day over day, in line with the CFR Taiwan/China marker.

The octane market has been "ugly," a US-based source said, with blending components such as alkylate and reformate falling more than 10 cents/gal in the week ended March 7, despite the approaching summer gasoline blending season.

The RBOB 91.4-83.7 spread narrowed considerably, averaging 17.64 cents/gal so far in March compared with 30.54/gal cents the previous year, indicating a reduced value for octane and weaker blending incentives.

Persistent imports into the region have pressured PX prices, with nearly 50,000 mt of xylenes arriving in February alone, according to US customs data, alongside ongoing PX shipments from Europe.

Selective toluene disproportion units, which convert nitration-grade toluene into PX and benzene, continued to run in the US, contributing to the overall PX supply despite thin margins.

"We don't anticipate them turning off anytime soon," a US-based analyst said. "Forward demand for toluene still looks weak and is getting weaker, so if benzene and PX levels stay where they are, they'll continue to run in the US."