International oil prices have stabilized, and the market’s expectations for polyester and downstream supply and demand are improving. The polyester chain broke out across the board last Friday night and maintained its leading position on the 5th. PTA closed up 5.5%, while staple fiber and ethylene glycol rose 3.7% and 5.4% respectively.
Affected by the three consecutive days of softening in international oil prices last week, the polyester sector was dragged down to a certain extent during the week. However, on Friday night, international oil prices closed slightly higher, ending three consecutive days of sharp declines, mainly because OPEC may discuss production cuts at its September 5 meeting. As the short-term domestic device operating rate and import volume remain low, the overall supply and demand of PX remains tight, and the absolute price of PX may become stronger based on the fluctuations in oil prices.
On the supply side, in September, PTA equipment continued to undergo maintenance and shutdowns to reduce loads, and the daily supply and demand destocking was relatively strong. Some suppliers’ shipments are blocked, polyester factories still need to replenish supplies, and suppliers still have buying orders. The basis continues to rise, and spot prices follow up. Baocheng Futures believes that the cost side of PTA will have strong support in the short term, and there are expectations for marginal improvement in supply and demand. It is expected that short-term PTA price performance may be stronger. Since last week, the supply of short fiber has also dropped significantly, and the market has followed up the increase vigorously.
On the demand side, with the alleviation of power restrictions in East China, the operating load of the weaving and polyester industries has recovered to a certain extent recently. The current operating load of the polyester industry has been raised to a level above 82%. There are currently 3 sets of polyester in September. With the release of 1.15 million tons of new production capacity and the restart of superimposed maintenance equipment, demand is expected to improve month-on-month. However, compared with the same period in previous years during the Golden Nine peak season, the quality is still insufficient. The market is mostly waiting for the performance of Double Eleven orders in the later period.
Recently, the domestic ethylene glycol term market has fluctuated at a low level, and the price trend has been slightly stagnant, but today the market broke through and rose sharply. In late August, the coal chemical industry started to shut down for centralized maintenance. Today, Shaanxi Weihe Chemical Industry started to shut down for maintenance. In early September, with the successive restarts of Sanning’s 600,000-ton and Hongsifang’s 300,000-ton units, the industry is expected to bottom out and recover; while integration On the other hand, Hengli 180 has successfully restarted, and Zhejiang Petrochemical Line 2 has recently restarted. Although the start-up of coal chemical industry is at a low level, due to the rapid improvement of integration, the overall monthly output of the industry is still based on incremental expectations.
Affected by overseas equipment maintenance and shipping schedules, the expected arrival at the terminal in late August has been significantly reduced, and arrival in early September is expected to remain low. In addition, with the strong trend of the US dollar index, the RMB exchange rate against the US dollar has once again depreciated sharply. Ethylene glycol is a product with high import dependence, and exchange rate fluctuations have a greater impact on it. Longzhong Information believes that short-selling funds are currently relatively cautious, and some are showing signs of short-selling, and the chances of the trend stabilizing and rebounding in the later period are greatly increased.
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