Turkey's PET feedstock supply tight as Middle East war cuts feeds supply

Turkish PET producers are grappling with tight feedstock availability as the war in the Middle East limits the region's exports of paraxylene, purified terephthalic acid and monoethylene glycol.

Monoethylene glycol supply has tightened in Turkey following the escalation of the conflict, with shipments from key ethylene glycol supplier Saudi Arabia delayed or canceled due to the disruption.

"All cargoes are delayed from Saudi Arabia," a PET producer said. "Any ordered volumes are not being shipped."

For spot material, prices have risen due to tighter supply and higher fuel and insurance costs related to the Middle East conflict, which have increased the expense of delivered material.

In addition to imports from Saudi Arabia, Turkey also imports from the US, which has also seen increased delivery costs. Furthermore, European and Turkish PET producers have seen rising competition from Asian producers for volumes out of the US amid the tight Saudi Arabian supply.

Following this tightness in feedstock supply, the Turkish PET market has also seen supply tighten, with consumers accepting price increases to secure volumes while others reconsider contract negotiations.

As a result, Turkey saw sharp PET price rises in March as sellers adjusted their offers to reflect the higher feedstock costs and tighter supply.

Platts, part of S&P Global Energy, assessed April 1 the three- to 15-day forward PET ex-works Turkey spot price at $1,405/metric ton -- its first assessment of Turkish PET.

Similarly, European PET producers have increased spot pricing while material availability has fallen, with producers receiving minimum contracted feedstock.

Platts assessed the three- to 30-day forward PET free delivered Northwest Europe spot price at Eur1,450/mt on April 1, up Eur570/mt month over month.