When the international oil price soared to US$130/barrel, it has to be said that the phenomenon of “flour is more expensive than bread” has already appeared in the polyester industry chain.
On March 8, the processing difference of PTA dropped to -12 yuan/ton. If the cost of acetic acid is added, the processing difference dropped to -156 yuan/ton. This phenomenon made people in the industry exclaim that it has never been seen before in history. PTA has never seen negative processing fees in history.
The reporter learned during the interview that the so-called negative processing fee can be understood as an extreme phenomenon that occurs when upstream and downstream products are in a period of severe fluctuations. At the same time, the profit difference of downstream chemical products can also be seen. Currently, oil prices are rising rapidly, but downstream products are unable to keep up, and processing profits are being squeezed. With the decline in processing fees, the maintenance of PTA equipment has also attracted much attention. How long can the PTA factory sustain such a low processing difference?
A PTA company with a daily output of 1,000 tons theoretically loses 400,000-500,000 yuan a day.
“The spot processing difference of PTA is negative, which means that after counting auxiliary materials, power and other fixed costs, the average loss per ton of PTA purchased and made now is expected to be 400-500 yuan.” Tianfeng Futures analyst Liu Siqi said that for a daily output of 1,000 For a company that produces 100,000 tons, the theoretical loss in one day’s production is 400,000-500,000 yuan.
It is understood that the recent cost-side oil prices have fluctuated too much and increased at an alarming rate. Under such circumstances, the prices of downstream products have increased more slowly, and PTA processing fees have also hit new lows.
In the past five years, the highest PTA processing fee is more than 2,200 yuan/ton, and the lowest is about -20 yuan/ton. The difference between the highest and lowest processing fee is more than 2,200 yuan/ton.
“The main reason for the significant fluctuations in processing fees is the cyclical changes in PTA production. During the production capacity shortage cycle, PTA inventory is low and profits expand. High profits stimulate new production capacity to accelerate production. After the equipment gradually enters the centralized production period, excess Only when the supply compresses profits to a loss-making state can some high-cost production capacity be eliminated and the market cleared.” Liu Siqi said that the current PTA processing fee continues to be weak, mainly because PTA is in an oversupply cycle.
The reporter observed that PTA processing fees have been performing poorly after the Spring Festival. Starting from the end of February, the three major suppliers have announced production cuts. Although this action caused the PTA basis to strengthen, the processing gap failed to repair as expected by the market.
“The reason for this result is that the price increase on the cost side is too strong, while the downstream demand is weak, the upstream and downstream are in a state of serious tearing, and the profits of intermediate products are continuously squeezed.” Pang Chunyan, an analyst at SDIC Anxin Futures, said, including PX, Ethylene glycol, filament, staple fiber, etc. all fell into a loss situation. Overall, PTA processing fees show a downward trend.
According to Pang Chunyan, domestic supply and demand were tight before 2010, and PTA had excess profits. In addition, early process processing costs were relatively high, and processing fees have been at a high level of more than 2,000 yuan/ton for a long time. From 2012 to 2014, after a wave of concentrated production, PTA processing fees continued to decline. The main reason was that supply turned from tight to surplus, and excess profits were squeezed. At the same time, the scale of new equipment and process advantages reduced the processing cost per ton. PTA Processing fees continue to decline.
From 2014 to 2016, under the situation of overcapacity, market competition was fierce and processing fees remained low for a long time. After 2017, downstream consumption recovered, and PTA supply and demand turned to a tight balance. In 2018, a short-term violent profit expansion was staged. While the rapid increase caused obvious harm to downstream consumption, PTA’s huge profits could not continue at high levels.
Since 2020, consumption has changed around the epidemic, but new PTA equipment has continued to be put into production. Therefore, processing fees have also shown periodic fluctuations, and the overall fluctuation has been around 500 yuan/ton.
It should be noted that the current negative processing fee is calculated based on the current PX buy now and make now. It can be understood that the daily raw material procurement expenditure is greater than the product sales revenue, and the company’s daily turnover is a loss. However, there is a certain time lag between the actual factory’s raw material procurement and product sales. If considered from this perspective, the factory’s existing PTA inventory will actually appreciate in value. Pang Chunyan explained that raw material prices are now high, while downstream demand is weak. Under the double squeeze of cost and consumption, losses in intermediate links have intensified. “Demand continues to be sluggish, and the backlog of PTA inventory means the occupation of funds and the accumulation of risks. Once the market Turn, the risk of inventory depreciation will increase significantly. ”
The profits of the industrial chain are shrinking as a whole, and it is not ruled out that more devices will undergo maintenance
At present, the profits of the polyester industry chain are shrinking as a whole, with losses ranging from PX to PTA, olefins, ethylene glycol and downstream polyester.
According to CCF senior analyst Shen Yinjiao, as the international oil price exceeds 100 US dollars/ton, the product benefits of the polyester industry chain (PX-PTA-polyester) are gradually compressed. At present, except for bottle flakes and DTY, there are still profits. According to the spot purchase price According to the calculation model, other products are basically at a loss. Under the pressure of inventory, the growth rate of downstream products is not as high as that of crude oil. Under high costs, as the naphtha cracking price spread expands, the benefits of the aromatics industry chain are gradually compressed.
“Significant losses have also occurred in the PX link in 2021. The price difference between PX and naphtha has been as low as 120 US dollars/ton. However, the company has maintained stable production for a long time, mainly because by-products such as pure benzene are profitable, to a certain extent. �It makes up for the losses of PX, and the factory terminal is also equipped with other products. In addition, from the perspective of the entire enterprise, the profits of refined oil products are better, and the overall profitability of integrated refineries is better. “Zheshang Futures analyst Zhu Lihang said.
In Zhu Lihang’s view, due to time mismatch in the short term, negative processing fees will not have much impact on the actual operating conditions of the company. But as time goes by, cost pressure will become more prominent.
“In the past, when companies faced long-term losses, large-scale supply overhauls would occur to increase profits.” Zhu Lihang said that long-term losses will definitely force the supply side to start overhauls, and large-scale production cuts and shutdowns are very likely to occur in the future. things. After all, for the polyester industry chain, efficiency is an important indicator that affects the start of production.
“Negative processing fees are just a ‘flash in the pan’ product of the surge in crude oil. If processing fees are maintained at such low levels for a long time, production companies will face huge losses, which will cause a large number of maintenance and shutdowns on the supply side, and increase processing fees, in order to achieve a balance in the industry. state.” Zhu Lihang said.
In this regard, Pang Chunyan also said that as far as polyester industry chain companies are concerned, refinery integration and downstream product diversification have a positive effect on companies coping with risks. “But this year, with the sharp rise in oil prices, the profits of refined oil products have also been squeezed, and chemical products have fallen into comprehensive losses. There is no profit at all in both integrated refineries and short-process units.” Pang Chunyan said that if demand does not recover, Amid expectations of rising inventories and declining profits, production reduction has become an option that companies must consider.
“At present, PTA processing margins continue to decline. Under the pressure of losses, the maintenance of PTA equipment has gradually become clear. Some of Yisheng’s equipment have begun maintenance one after another. Hengli also has maintenance plans from March to April. Fuhaichuang also reduced its load in early March. Supply The end of the market has begun to shrink, and the market has gradually begun to destock.” Shen Yinjiao said.
In her view, in the short term, companies will have certain reserves of raw materials in each link of the actual production process. “However, due to the rapid rise in prices this time, the cost of some raw materials (inventory) of the current enterprises is relatively low, which has alleviated the high cost pressure of the current enterprises to a certain extent. With the digestion of low-priced raw materials, the continued low processing fees We do not rule out the possibility that more devices will undergo maintenance,” Shen Yinjiao said.
At a time when there are concerns about the rapid rise in raw material costs and production’s insufficiency, the sharp plunge in international crude oil prices may bring some comfort to the PTA industry: the rise in raw material prices has finally pressed the “pause button.”
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