In May, the market price of polyester bottle flakes rose first and then fell. During the May Day holiday, international crude oil prices rose strongly, and raw material prices increased accordingly. With cost support, the market price of polyester bottle flakes increased to 6,450 yuan/ton, but the demand for raw materials from downstream companies was low. As oil prices fell, PTA and ethylene glycol prices began to fall, cost-side support weakened, the market price of bottle flakes fell to 6,275 yuan/ton, and the market focus subsequently declined.
With the smooth start of production of a factory in South China, the tight supply situation in the bottle flakes market has eased, but the social inventory of bottle flakes is still at a high level, the consumption of downstream terminals is slow, and some trade The performance of the contract in May was not good, and a small amount of low-priced supply began to appear on the market, making it difficult to increase the focus of the bottle flakes market, and the cash flow of bottle flakes continued to be in a state of loss.
From a cost perspective, domestic mainstream suppliers have officially announced reductions in May contract supply. There are not many spot items circulating in the market. Some supply sources are tight. The reluctance of stockholders to sell has increased. Spot stocks The basis began to strengthen significantly; in addition, a total of 4 million tons of PTA units of Hengli Petrochemical and Honggang Petrochemical announced maintenance in June, and the restart of the 650,000-ton unit of Yisheng Ningbo was postponed. Before the new unit of Yisheng Petrochemical was put into operation, the PTA market in June theoretically declined. Inventories support the strengthening of the spot basis, but the trading atmosphere in the spot market weakens; the overall supply of ethylene glycol in May is positive, and the new satellite petrochemical equipment is put into operation. However, due to the centralized maintenance of domestic equipment, domestic production is significantly reduced, and the spot market is circulating at the end of the month. On the tight side, the overall focus of the ethylene glycol market is strengthening.
From the supply side: The operation of polyester bottle flake manufacturers was basically stable in May, and there was no equipment maintenance for the time being. The industry’s operating rate remained at 73.06%, and the output in May was 760,500 tons. A year-on-year decrease of 0.31% from the previous month. With the successful commissioning of a new device in a factory in South China, the tight shipment situation in some areas has been alleviated. However, the current social inventory of bottle flakes is still at a high level.
From the demand side, downstream demand performance continues to be sluggish, inventory consumption is slow, and export volume declined in April. In April 2021, my country’s polyester bottle flakes export volume was 245,300 tons, and the average export price was US$878.96/ton. Export volume decreased by 20.35% month-on-month and increased by 6.34% year-on-year. Compared with last year, the cumulative export volume of polyester bottle flakes increased by 4.39%.
From a profit perspective, due to rising crude oil prices driving up raw material prices, costs have increased significantly, but Downstream demand is weak, the market focus of polyester bottle flakes is difficult to increase, and corporate profits are basically at a loss. The average cost of polyester bottle flakes this month is 6,340.16 yuan/ton, an increase of 89.16 yuan/ton from the previous month, and the average profit margin is 7.41 yuan/ton, a decrease of 224.42 yuan/ton from the previous month.
Taken together, May and June of previous years were the boom times for polyester bottle flake factories. It is the peak season for goods, but this year, the peak season is not booming. The social inventory of bottle flakes is slowly digested, and the downstream demand continues to be sluggish. Some factories are experiencing tight shipments, but they only maintain the necessary replenishment. A 400,000-ton unit at a factory in Zhejiang was shut down for maintenance in early November 2020 and was originally planned to restart in June this year. However, judging from the current overall market conditions, the restart time may be delayed. The recent strong rise in polymerization costs has deepened the cash flow losses of polyester bottle flakes, making it unlikely that factories will ship products at low prices. However, most traders already have June orders in hand and are not willing to continue to restock. It is expected that the polyester bottle flake market may continue to be weak and volatile in June. </p
