The European PTA market: Five key facts on pricing dynamics

• Significant spikes in energy and other production costs in Europe (such as acetic acid) negatively impacted PTA producers’ margins during 2021. • In H2 2021, production issues in Europe and maintenance turnarounds kept domestic PTA supply very tight at a time of consistently strong demand and critically low inventories caused by the effects of the pandemic. • Throughout 2021, the European PTA market was impacted by high freight rates from Asia into Europe. • Despite initial opposition to surcharges, the challenging market conditions supported these initiatives and surcharges were finally implemented starting in November 2021. • The PTA-PX spread in Europe was further increased at the beginning of 2022. • Spreads are now revised more frequently because of the high uncertainty levels. • Import parity prices recently started gaining competitiveness, which will increase pressure on European prices, limiting PTA-PX spreads moving forward.