Since March 2023, many banks in Europe and the United States have experienced thunderstorms, which has triggered the spread of market sentiment. The price of crude oil has plunged sharply, leading to a collective weakening of downstream chemicals. However, PTA suddenly emerged and rose against the trend, bringing a glimmer of hope to the depressed commodity market.
With the market going well, the market attention is focused on PTA, and things about PTA production capacity have also changed recently.
New progress of Hengli and Yizheng chemical fiber PTA projects
1. The first production line of Hengli (Huizhou) PTA project was successfully put into operation at one time
On March 18, the first PTA production line in Hengli (Huizhou) Industrial Park was successfully put into operation at one time, and qualified products were successfully produced the next day, marking the Hengli (Huizhou) PTA project ushering in a new stage of high-quality operation. Lay a solid foundation for the entire project to be put into operation.
It is understood that the Hengli (Huizhou) PTA project signed an investment cooperation agreement on August 13, 2020, and officially started construction on January 7, 2021. The project has a total investment of 15 billion yuan and covers an area of 700 acres. It is Hengli Group’s first project in South China and is also a positive move to implement the development strategy of the Guangdong-Hong Kong-Macao Greater Bay Area. The project adopts industry-leading green and intelligent PTA production technology, focusing on the construction of a 5 million tons/year PTA device (two 2.5 million tons/year PTA production lines) and auxiliary facilities. It has “large investment scale, strong production capacity, High level of technology and low energy consumption. After the project is fully put into operation, Hengli Group’s annual PTA production capacity will reach 17 million tons, ranking first in the world.
2. New progress in the construction of Yizheng Chemical Fiber PTA project with an annual output of 3 million tons
Coincidentally, another set of PTA projects planned to be launched within the year has ushered in key developments. On the 21st, the first oxidation pressure distillation tower, the longest and heaviest equipment of Yizheng Chemical Fiber’s 3 million tons annual PTA project, was installed smoothly and smoothly, marking a solid step forward for the project to be completed and put into production on schedule. A crucial step. It is understood that the total investment of the Yizheng Chemical Fiber PTA project with an annual output of 3 million tons exceeds 5 billion yuan. It is Sinopec’s first PTA project with an annual output of 3 million tons. It is also the leading project for transformation, upgrading and high-quality development of Yizheng Chemical Fiber during the “14th Five-Year Plan”. This project has the advantages of large-scale single equipment, green and low carbon. Once completed, it will effectively enhance Yizheng Chemical Fiber’s polyester raw material supporting capabilities and promote the development of subsequent new material projects such as smart fibers and biodegradable plastics.
In the new year of PTA’s production, advanced equipment will impact the elimination of excess production capacity
Since the end of 2019, this round of PTA large-scale production cycle has begun. In the past three years, the growth rate of PTA production capacity has always been above 10%, and the newly put into production are all advanced devices with a capacity of more than 2 million tons. The average processing cost of the industry has been significantly reduced, and processing fees have been long-term. At a relatively low level, the elimination of excess production capacity has accelerated significantly. 2023 is another year for large-scale production of PTA. The annual new production capacity may reach 14.5 million tons, and the production capacity growth rate will reach 20%.
According to the PTA production plan statistics from relevant information websites, the average annual growth rate of PTA production capacity from 2023 to 2024 is about 13%. The specific production equipment is as follows. At present, the production capacity of 7.5 million tons of new installations in the first half of 2023 is relatively certain, including Hengli Huizhou 1# in March, Jiatong Energy 2# in April, Hengli Huizhou 2# in May, and Hengli Huizhou 2# in May. Each set of equipment has a capacity of 2.5 million tons. There is no clear information yet on the capacity of the 7 million tons of new equipment in the fourth quarter. There is a high probability that it will be put into production by the end of the year, but the actual production will be more reflected in 2024.
To sum up, a large number of advanced PTA devices will still be put into production from 2023 to 2024, and the elimination of excess production capacity is still accelerating. While there is no major trend in crude oil prices, PTA has mainly fluctuated widely this year or most of the time, and its rhythm needs to be more precise.
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