By Frank Esposito
SENIOR STAFF REPORTER
Published: September 11, 2014 3:31 pm ET
Updated: September 11, 2014 3:35 pm ET
North American PET bottle resin prices increased by an average of 2 cents per pound in August, due in part to a shortage of purified terephthalic acid (PTA) feedstock caused by a fire at a British Petroleum plant in South Carolina.
The increase was only 1 cent at some accounts, and was tied in to “tightening supplies and an uncertain feedstock supply outlook,” according to Mark Kallman, a market analyst with Resin Technologies Inc. in Fort Worth, Texas.
“So far, the PTA line outage has contributed to lower paraxylene (feedstock) pricing and reduced PET production,” Kallman added. “The longer this goes on, the higher the impact as the line that went down is 20-25 percent of the domestic PTA production.”
Kallman also said that with excess PET resin available in Europe from added capacity — and with low PET prices in Asia — imports could help alleviate North American PET supply issues until the PTA outage is resolved.
The PTA outage occurred after an Aug. 11 fire at BP’s Cooper River, S.C. plant. No one was injured in the fire, but the blaze caused “extensive damage” to a compressor building at the site, according to an article in the Charleston (S.C.) Post & Courier. One PTA unit at the site remains in operation, according to the article.
BP spokesman Scott Dean told the paper that BP “is assessing the extent of damage to the compressor building and working to get the unit safely restarted.”
Market sources said that BP is allocating supplies of PTA and filling customer orders at a 60-80 percent rate. The site has a combined total PTA production capacity of about 1.6 billion pounds per year.
Prior to the fire and resulting PTA tightness, some market watchers were expecting a slight drop in regional PET prices for the month, as beverage demand declines as summer moves into fall.
The August increase follows a combined 5 cents in price increases that hit the North American PET bottle resin field in June and July. Those increases also were tied into raw material pressures, which were worsened by the BP fire.
The recent hike now leaves regional PET prices up a net of 2 cents so far in 2014. The June-July increases had canceled out a total of five cents in decreases that hit the market in the first four months of 2014.
Now with 12 cents of price volatility through eight months, the North American PET sector has equaled the amount of price volatility it saw for all of 2013. These totals, however, are low when compared to recent price history. From 2008-12, PET price volatility in the region had averaged almost 35 cents per year.
Regional PET demand remains flat to slightly down so far in 2014, as a result of reduced consumption of carbonated soft drinks and of thinner water bottles requiring less resin per bottle. | 
