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China’s post-Golden Week holiday demand for plasticizers could slow
Import demand for plasticizers in China may take some time after the market resumes from the Golden Week holiday before re-emerging.
While some players initially expected demand to “hit the ground running” immediately after the holidays, a lack of discussions just before the week-long holiday in China has put those expectations into question.
In the dioctyl terephthalate (DOTP) market, producers said many buyers were putting in cursory "low bids” before the holidays, on expectations of a slow post-holiday market.
As a result, some sellers expect that they may face some inventory pressure after the Chinese holidays.
While one major producer said it would rather reduce its plant’s run rates than to lower prices to induce buying interest, other producers may hold a different stance.
Chinese buyers may not be likely to enter the market in the week of 7 October. Even if they have some pent-up demand, they are likely to seek cargoes domestically.
Major producers in Taiwan and South Korea may also opt to take to the sidelines as there are public holidays in the same week.
The average price in the DOTP import market was lower at $1,045/tonne CFR (cost & freight) China in the week ended 4 October, according to ICIS data.
Feedstock 2-ethylhexanol (2-EH) prices in China are not likely to provide much direction for DOTP, as talks are also expected to be muted. Plasticizers are used in plastics or other materials to impart viscosity, flexibility, softness, or other properties to the finished product.