Ethylene glycol has been the weakest among polyester chains recently. It fell 1.7% again today to 4,170 yuan, falling for four consecutive days. After international oil prices weakened, PTA compensated for its losses and turned green today.
Thanks to the integrated development of the industrial chain, the risk management and control capabilities of the PTA industry have been significantly enhanced. Manufacturers balance supply and demand through flexible adjustments to production, and the PTA supply side maintains a highly elastic state. Post-holiday downstream demand was lower than expected, PTA inventory continued to accumulate, and processing fees were significantly reduced. Starting in February, PTA factory load fell again, and the market supply margin shrank. In terms of new production capacity, 2.5 million tons of Jiatong Energy has been put into operation in January. Another 1.25 million tons unit of Dongying United has been put into operation in mid-February. Hengli Huizhou No. 1 2.5 million tons unit is scheduled to be commissioned in early March. New units are gradually reaching production. In the medium to long term, the problem of PTA overcapacity will intensify.
The increase in the domestic EG supply side is clear. Hainan Refining and Chemical has stabilized production. In the later stage, many units such as Guangxi Huayi, China Salt Red Sifang, Yangmei Shouyang, and Yongcheng Yongjin have plans to restart. However, there are still several new units in the country. The device is to be put into production. In the coal chemical industry, due to the easing of the tight supply of raw materials, the capacity utilization rate will be improved, further increasing the domestic supply, and the overall supply and demand will still continue to be weak.
On the demand side, polyester and downstream loads basically fluctuated at high levels last week and maintained operations. Sales volume is still good, and there is no pressure on the sales side for the time being. The average seven-day production and sales of polyester yarn in Jiangsu and Zhejiang is estimated to be around 110%. The inventory of polyester products has a downward trend, terminal inventory has accumulated slightly, and the conduction recovery is good.
However, there are still hidden concerns in the terminal link. Since entering the traditional peak season, domestic trade orders for spring and summer have been placed, but lack of support from new fabrics, and the main consumption is still inventory; foreign trade orders are not yet clear, and companies are cautious about later orders. Taken together, the situation of new terminal orders has not improved significantly, and the overall inventory is still high.
Galaxy Futures believes that the current inventory of ethylene glycol ports is relatively high, and there may still be accumulation pressure in the medium term, and the price shock will be weak.
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