Introduction
Under the influence of geopolitical factors, the trend of rising international energy prices has shown no signs of easing. Currently, the highest international crude oil price has approached the historical price set before the 2008 financial crisis. Boosted by this, the strong support from the cost side of PTA has caused the price to rise sharply. However, the sharp increase in cost pressure has also led to a compression of processing fees for PTA manufacturers. As of March 9, PTA processing fees have remained at -91 yuan/ton, a record high. All time low.
Data source: Jin Lianchuang
The strong rise in crude oil prices has boosted the PTA market to a certain extent. However, the main logic behind this round of PTA surge still comes from cost-side support. The highest price of crude oil has approached the historical high price created before the financial crisis in 2008. The crude oil series commodities have risen sharply as a whole, and the price of PTA has also risen accordingly. At the same time, PTA’s main factories are undergoing intensive maintenance, and the supply shrinkage has caused the PTA futures basis to strengthen significantly. In addition, the demand for polyester in the downstream has recovered slightly, and the order inquiry atmosphere of some merchants has improved compared with the previous period, and the urgent demand for replenishment is stable. As of March 9, the market price of PTA in East China has risen to 6,500 yuan/ton, an increase of 20.17% from February 23. However, due to geopolitical factors, the sharp rise and fall in oil prices played a leading role in PTA. With OPEC+ production hitting its largest increase in seven months, the UAE supports increasing production, the IEA may continue to release reserves, and Ukraine hinted at compromise to cool down the market situation. Crude oil prices plummeted. Affected by this, the main PTA futures 2205 contract morning on March 10 It opened at the lower limit and was closed at the lower limit during the day. The spot price of PTA in East China fell sharply, reaching around 6,025 yuan/ton, a decrease of 7.31% from the previous day.
Data source: Jin Lianchuang
Entering 2022, the processing fees of domestic PTA companies will continue to decline. At the beginning of the year, the processing fee remained at 600-700 yuan/ton. When the international oil price soared to 130 US dollars/barrel, the price of raw material PX rose simultaneously. However, the price increase of PTA products is slow, and PTA processing fees have hit new lows repeatedly. Although the main PTA suppliers’ equipment has been intensively inspected and repaired in turn, the supply has shrunk significantly. At the same time, the demand for downstream polyester has gradually recovered, and the market accumulation has been alleviated. However, the PTA processing fee has not been repaired as expected. The fundamental reason for this result is Prices on the cost side have risen too fast, while downstream demand has been weak. The upstream and downstream are in a serious imbalance, and the profits of intermediate products have been greatly squeezed. As of March 9, the average processing fee for PTA spot was -91 yuan/ton. The mainstream price of acetic acid in East China on that day was 4,125 yuan/ton. The converted consumption cost of PTA per ton was 144 yuan/ton. If the cost of acetic acid is excluded, the PTA The net processing fee is only -235 yuan/ton, a record low.
Taken together, under the constraints of low processing fees and as domestic maintenance capacity of PTA companies is relatively concentrated from March to April, PTA operating rates may be further reduced. From the perspective of the entire demand side, the current status of downstream polyester production is high and inventory is high, and there is still room for price reduction and promotion of polyester efficiency levels. Although the terminal weaving factory has basically resumed production, the daily flow of people in the market has not been high since its opening, and the market performance has been quite dull. Under the sharp rise in raw materials, although end products have risen simultaneously, end customers have limited acceptance of high prices, and actual transactions are mostly profitable. At present, orders are still mainly received in advance before the holiday. The overall market mentality has gradually become cautious and pessimistic, and confidence in the market outlook has gradually weakened.
Therefore, there are still small fluctuations in the current supply and demand fundamentals of PTA, but the main logic of market fluctuations still depends on crude oil. If oil prices continue to be strong, it is expected that the PTA market may still have room for growth in the short term.
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