There has been a big slump in demand due to the decline in the polyester market. MEG prices have been hanging at the low $400s/tonne CFR China since May. Export demand is expected to stay weak as export business will slow down during the summer holiday in Europe. Polyester operation cuts are expected to remain in place during the summer season as most polyester producers are facing not only inventory pressure, but also cash flow issues. “Now we can only pin our last hopes on September and October as these two months are the peak season for the textile industry,” a Chinese polyester producer said. The slowing demand also resulted in rising port inventories. China’s port inventories have increased to close to 1.5m tonnes, the highest level since 2014.
