Trend: PX and PTA
In the recent period, the supply and demand of crude oil itself has been tight. PX has adjusted high profits and low inventories under the backdrop of the peak overseas travel season. The shrinking supply of PX in Asia, Japan and South Korea has helped the market price continue to rise, jumping more than 13 months compared with before the Dragon Boat Festival. percentage points, PTA followed the increase simultaneously, but the increase was insufficient to follow up.
Then, as the gains gradually shifted downward, the market lacked sustained buying momentum, coupled with the Federal Reserve’s interest rate hike, which dampened remote consumption and confidence, the PX correction drove the absolute price of PTA to retrace its highs. On the one hand, we are waiting for the market to digest the increase; on the other hand, the supply and demand of PX-PTA are broadening. As of June 16, the PTA spot market price dropped to 6,252, a correction of 466 from the 10th, giving up nearly half of the increase, but 454 higher than the price on the 2nd (before the Dragon Boat Festival). (Unit: Yuan/ton)
Processing fee: PX-PTA
From January to April this year, PXN remained between 180-270. In May, driven by the peak travel season in the United States, PX adjustment logic drove the sector to rise rapidly. In early June, PXN was close to 700; however, domestic PX devices continued to pay more than 15 percentage point, the long-stop device restarted and new production capacity was put into operation, and PX continued to fall back from 1500 to around 1257. During the large and rapid correction window, PTA processing fees gradually recovered, rising from negative to 800+. (Unit: Yuan/ton)
Load: PX-PTA-PET
During March, due to the fermentation of the epidemic, the polyester load continued to decline from a high point of 95% to a drop of more than 15 percentage points in April. The sharp drop in demand forced PTA equipment to reduce the rate to avoid risk; during this period, with the return of processing fees, However, the back-end momentum is not good, domestic trade consumption has been downgraded and foreign orders have been insufficient to supplement the supply, and the recovery of polyester load has been particularly slow. For PX, the load continued to rise when supply was tight and price differentials were high, and many PTA devices were restarted after maintenance. Due to the shrinkage of PXN and the recovery of PTA labor costs, the PTA load increased by nearly 5 percentage points from last week, but the polyester load dropped slightly by 0.82 percentage points to 83.10% under the background of high costs and negative profits.
On the whole, the peak season for overseas travel continues, high oil prices will continue, there is a need for repairs after the deep decline of PX, and although polyester has declined, the rigid demand remains; it is expected that the far end of the PTA market will still have strong expectations, but it will still withstand the pressure from the market in the short term. Due to the squeeze from upstream and downstream, market prices may be weak near but strong far away.
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