01 A surprising price increase
Another price increase!
Why?
If it goes up, I will go up!
If TA falls, will you fall?
we’ll talk about it then!
The market reversed again over the weekend. With the popularity of raw materials on Friday night, the market ushered in a new round of bottoming out, with production and sales booming!
I don’t know if the current downstream industry is suffering from post-traumatic stress disorder due to the price increase a year ago. Nowadays, whenever there is any trouble, they are ready to take action. No matter how much, they always have to buy some to feel at ease. Let’s take a look at the recent purchasing mentality of some downstream users:
“I bought a little bit when it was cheaper in the past two days, but I didn’t dare to buy more. First, I was afraid that the price of raw materials would fall in the future. Second, I didn’t have much money on hand to stock up on raw materials, but I feel that the prices of raw materials should also rise now. We can’t go up anymore,” said a boss who specializes in polyester taffeta and pongee fabrics.
“We only need to purchase products once every half a month or so, and we no longer care about the market conditions.” The owner of 300 looms said helplessly.
Buy when there is an order, quote the raw material price on the day, and purchase raw materials for production immediately after placing the order. This is probably the current situation of textile bosses. They dare not buy high-priced raw materials in advance. If you are not careful, you will lose money.
Therefore, now the bosses are buying low-priced goods, and there is no need to negotiate once the price increases!
02 The market is still confusing, with both bulls and bears holding different opinions.
Saxo’s chief economist believes crude oil may hit $120 again! The reason is that the risk of a European energy crisis cannot be ignored. He predicts that the high point of international oil prices in the third quarter will be between 110 and 120 US dollars. The price cap plan was poorly designed and executed.
A futures company is heavily bearish on PTA, believing that TA will fall to 4,000! The reason is that the terminal is weak. Under the adverse fundamental situation of weakening cost-side support and increasing excess pressure on the supply and demand side, the price is expected to return to the 3,000-4,000 yuan/ton level.
The most troublesome thing is that the overall polyester inventory is still at a historically high level!
Comparison of month-end inventory of polyester filament sample companies from 2020 to 2022
As shown in the figure above, the average inventory of polyester filament is 35.5 days, an increase of 0.9 days compared with the end of June, and an increase of 15.4 days compared with the same period last year. Taken together, the current corporate inventory is still at a historically high level, while the downstream weaving operating rate remains low. In the short term, demand has not increased significantly, further exacerbating the contradiction between supply and demand for polyester filament.
The current operating rate of chemical fiber weaving in Jiangsu and Zhejiang is 45.51%, down 1.40% from last week. Currently, the operating rate of most weaving factories is at a low level.
Therefore, the situation on the supply side of polyester filament is very severe, and the downward pressure on the market is still great.
From a fundamental analysis, the market trend is still confusing and may rise or fall. Therefore, in order to survive at the moment, the only safe thing is to replenish the raw materials after receiving orders. If there are no orders, do not buy at the bottom and stock up. Remember, preserving capital and surviving is the top priority this year, not making a lot of money.
</p
