Introduction: In 2023, the Asian PX market first rose and then declined. In the first quarter, it was boosted by macroeconomic favorable conditions, especially the optimization of China’s epidemic policy. Domestic chemical products generally recovered. The price of the industrial chain was strengthened under the guidance of the cost end, and the downstream PTA supply was tight, resulting in Prices have hit new highs this year. However, since mid-April, international crude oil has fallen from high levels. Coupled with the recession of the international economic situation, businessmen’s risk aversion has increased, chemicals have generally fallen, and PX and downstream markets have continued to fall. As of June 20, the closing price of CFR Taiwan PX was US$985/ton, which was US$38/ton higher than the end of last year, an increase of 4.01%. The average price in the first half of the year was US$1,038.5/ton, down 11.48% year-on-year.
Data source: Jin Lianchuang
The first stage: demand recovery combined with intensive maintenance, PX cargo tight and prices rising (early January to early April)
Crude oil fluctuated widely in early January, with little impact on costs. However, due to the relaxation of China’s epidemic policies, merchants are generally optimistic about the prospects of the Chinese market. PX spot purchasing enthusiasm has increased, and the sentiment of the industrial chain is optimistic. The performance of crude oil and the general environment in February was weak. In addition, Holders are worried about the commissioning of new equipment, and there is a sentiment of understanding about profits. The market sentiment has turned from strong to weak. In March, Huizhou Refining and Chemical’s 940,000 tons/year PX unit began maintenance, and there are expectations for the new PTA unit to be put into operation. The market has shown a certain resilience. , starting from the middle of the month, the downstream PTA market has been tight on spot, merchants have speculated, and the enthusiasm for PX procurement has increased. In addition, foreign demand for oil adjustment is good, aromatics plants are not operating at a high rate, and domestic PX maintenance equipment is intensive in April. The market takes the opportunity to link up with downstream promotion. rise.
The second stage: the overall industrial chain weakens, and PX weakens downwards (mid-April to the end of June)
The market began to fall back from its high level in mid-April. Due to the recession in the international economic situation, bulk commodities were generally weak, raw material naphtha fell, and cost support weakened, suppressing market sentiment. In addition, merchants were worried about the restart of PX maintenance equipment in the later period, and the mentality of the industry was bearish, and was Forced to sell goods at a discount. In May, the downstream PTA market was weak due to overstocking, and the demand for PX weakened. Downstream inquiries were generally made to lower prices, and the downstream market continued to decline. However, oil mixing demand in Europe and the United States began to rebound in June, and the price of raw material MX was strong, boosting market sentiment. However, as the maintenance equipment resumed and CNOOC Huizhou PX was about to be put into production, merchants were worried about the increase in supply, inhibiting the market from strengthening, and the market was mainly volatile and consolidated.
Forecast for the second half of the year
From the demand side: There are still 12.7 million tons of new PTA devices planned to be put into production in the second half of 2023, with most of the upstream and downstream supporting devices, so PTA supply pressure is heavy. However, under the combination of low processing fees and competition between brands and non-brands, the operating rate of some PTA companies may be passively compressed.
It is expected that the Asian PX market will mainly fluctuate in the range in the second half of the year. At present, PX production profits are considerable. Domestic PX devices are basically concentrated in the first half of the year. Maintenance has been completed. In the second half of the year, PX construction may increase to a high level. In addition, Huizhou Refining has a new 1.5 million tons/year PX device. It is planned to be put into operation at the end of June. Domestic supply is gradually increasing. However, terminals are facing environmental protection and other pressures, and terminal demand is difficult to increase. However, in the second half of the year, PTA has several new devices planned to be put into operation. PX demand will increase significantly, and domestic PX supply and demand may remain balanced. However, against the background of simultaneous increases in PX and PTA, the pressure on the PTA market has increased. On the whole, it is expected that the PX market will mainly fluctuate widely in the second half of the year, but the price center of gravity may slowly shift downward.
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