Asian paraxylene market plunged to a new near four-year low on further weakness across the oil and petrochemicals markets due to concerns over the coronavirus outbreak as market volatility and bearishness dampened sentiments and buyer confidence. In the downstream purified terephthalic acid (PTA) market as well, prices have tumbled to almost a four-year low.

There is also uncertainty over how much the prices will fall further, according to S&P Global Platts’ market insights. There is a lack of drivers to support prices at the moment.

Price recovery in the near-term might be tough without any sustainable support to fundamentals and overall sentiments, the report from the corporate entity said.

The operating rate of the downstream Chinese polyester and textile sectors, which are labour intensive, could not resume as quickly as expected after China extended the Lunar New Year holidays to contain the coronavirus.

Almost all Chinese textile producers have shut operation since mid-January, with the overall operating rate of less than 10 per cent of total capacity over the holiday, as S&P Global Platts reported earlier.

As a result, both PTA and polyester inventories have piled up during the holiday in China and there are talks to cut operating rate if downstream textile sector could not resume back soon.