I. Last Week (May 18–22): PET bottle chips initially held steady before weakening; both spot and futures markets experienced synchronized volatility. Spot prices in East China hovered around 8,900 RMB/ton at the start of the week; after surging mid-week, prices retreated, falling to 8,680 RMB/ton by Friday. The benchmark futures contract weakened in tandem. A correction in crude oil—a key raw material—weighed on production costs; meanwhile, downstream buyers adopted a wait-and-see approach, limiting purchases to immediate necessities. Consequently, manufacturers' willingness to hold firm on prices diminished, resulting in an overall market trend characterized by a retreat from recent highs and sluggish trading volume.

II. Analysis of Core Driving Factors

1. Cost Side: Crude oil corrected, leading to weakness in PET raw materials. As geopolitical tensions in the Middle East eased slightly, international crude oil prices retreated from their recent highs, causing PTA and MEG (Monoethylene Glycol) markets to fluctuate downward. The production cost for bottle chips stood at approximately 7,252 RMB/ton—a week-on-week decrease of 59 RMB. Gross production margins remained high at around 1,061 RMB/ton, indicating that manufacturers still possessed a strong incentive to maintain price levels.

2. Supply Side: Production operations remained stable, inventory levels were low, and export demand provided a market floor. Domestic production volume reached approximately 331,000 tons, with a capacity utilization rate of 71.4%—unchanged from the previous week. Expectations are rising for the restart of production facilities that had undergone prolonged shutdowns, suggesting that supply may increase in the near future. Factory inventories currently stand at approximately 8 days' worth of stock—a level near recent historical lows—resulting in a relatively tight supply of spot goods. Export orders remain robust; "zero-tariff" policies in countries such as Indonesia are boosting export prospects, while the price spread between domestic and international markets continues to lend support to domestic spot prices.

3. Demand Side: Domestic demand remained lackluster as the peak season drew to a close, with purchasing limited primarily to immediate necessities. The domestic peak season for terminal products—such as beverages and edible oils—is winding down; consequently, inventory restocking has slowed, and downstream buying sentiment has weakened, with market participants largely adopting a wait-and-see attitude. Demand from non-beverage sectors—such as sheet extrusion and injection molding—remained moderate, with purchasing focused strictly on immediate operational needs rather than proactive restocking, particularly given the lack of strong incentives to buy at current price levels.

4. Futures Side: Market capital fluctuated, warehouse receipts declined, and the basis spread remained wide. Futures prices experienced a sharp decline on Friday, driven by the correction in crude oil prices and the withdrawal of speculative capital, resulting in a short-term bearish market sentiment. Warehouse receipts continued their downward trend—accumulating a 23.79% decline this week—indicating that the underlying market dynamic of tight spot supply remains unchanged. The basis (Spot - Futures) remains at an elevated level of 500–600 RMB/ton, providing support to the futures market.

III. Market Summary and Outlook—Weekly Conclusion: A pullback in production costs has weighed on futures prices, while low inventory levels and robust export activity have provided a floor for spot prices. Manufacturers are holding firm on pricing, and transactions are being driven primarily by essential demand; overall, the market is oscillating within a high-level range.

Short-term Forecast (Late May – Early June): Pricing—Spot: 8,800–9,000 RMB/ton; Futures: 8,000–8,400 RMB/ton. The market is expected to experience wide-ranging fluctuations.

Key Factors: Crude oil price trends, PTA plant maintenance schedules, inventory changes, and export orders.

Risks: Should crude oil prices undergo a sustained sharp decline or if inventory levels begin to accumulate, spot prices may experience a minor correction; however, given the current low inventory environment, the probability of a steep market plunge remains low.

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