Polyester staple fibre (PSF) manufacturers in India have stabilized prices at Rs 93,000-Rs 95,000 per ton (around $1,105-$1,129) for Nov’24, after aRs1,000-per-ton hike implemented in mid-October. This is a result of the cost of purified terephthalic acid (PTA), a key input in the raw fiber declining slightly by Rs 400 per ton to Rs70,100 ($833.42) in the domestic market.
Despite these recent price adjustments, India’s PSF and raw material costs remain out of sync with global prices and crude oil trends. Indian manufacturers argue that elevated domestic raw material prices are limiting their competitive edge, particularly in export markets for garments, fabrics, and yarn. The cost structure, influenced by higher domestic pricing for PSF and PTA, poses a challenge for Indian exporters aiming to match international rates.
Highlighting the difficulties faced by Indian manufacturers, RKVij, President Emeritus, Textile Association of India (TAI) and Secretary General, Polyester Textile and Apparel Industry Association (PTAIA), says, the price gap between domestic PTA and imported PTA prevents Indian companies from offering competitive rates for exports. While domestic PTA is priced at Rs70,100 per ton, imported PTA, largely from China, is available at Rs66,500 ($790) per ton.
As of November, domestic PSF prices remain around Rs100,500 ($1,194) per ton, although discounts bring effective rates down to Rs 93,000-Rs 95,000. In comparison, imported PSF from China is priced slightly lower, at Rs 90,000-Rs 91,000 ($1,070-$1,081) per ton, making imports more attractive for some manufacturers.
Additional raw materials in the polyester value chain, Monoethylene glycol (MEG) and MELT, are priced domestically at Rs 58,800 ($699) and Rs80,290 ($954) per ton, respectively. The prices of MEG rose by Rs300 per ton, while MELT prices dipped by Rs340. However, due to licensing requirements under the QCO, imported MEG is often more competitively priced. Moreover, MEG is only a minor component in MELT production, further complicating cost management.
Fluctuations in crude oil, a primary input in polyester manufacturing, have not influenced domestic PSF pricing in recent months. For instance, WTI crude oil dropped from $74.38 per barrel in early October 2024 to $70.73 in early November, yet domestic PSF and upstream materials have not mirrored this trend.
