'PTA producers covering short positions' - Nippon Oil

20 Apr '09

2 min read

The prices of one of the basic raw materials used in the textile industry; petrochemicals is heading northwards since the last few fortnights. After petrochemical markets dipped in the second half of 2008, since the unfolding of the economic crisis, this is the first time in 7-8 months that the prices of petrochemical markets have rebounded to such levels.

Fibre2fashion spoke to Mr Rei Hioki, spokesperson of the Japan based oil and petrochemical major; Nippon Oil Corporation. Nippon Oil is a 130 year old company involved in refining and trading of oil, petrochemicals and gas and has 14,257 employees on its rolls and had net sales of ¥ 7,524 billion in the just completed financial year 2008.

We started off by asking Mr Hioki the reasons for the recent spurge in Paraxylene (PX) prices, to which he said, “We see the price increase as based on fundamentals. Due to turnarounds and some delay in start-ups etc, the market supply position looks tight and recent trends indicate that PTA producers in China, etc seem to be covering their short positions”.

Next we asked him as to how he foresees the future of the petrochemical industry, to which he replied by saying, “We see a slight recovery (in price and demand) from the current doldrums in the petrochemical market, which had been hit by global economic downturn. However as new capacities start-up as planned in the Middle East, China and other countries, we are also concerned that the market may face a position of over-supply again in the 2nd half of 2009”.

Fibre2fashion News Desk - India

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