Affected by the recent sharp drop in crude oil prices, PTA has opened up room for decline. At present, PTA processing fees have been severely compressed. At that time, the editor predicted that if PTA processing fees fell below 300 yuan/ton again, PTA factories might be more willing to actively reduce production. Unexpectedly, the PTA device maintenance capacity with a total capacity of more than 10 million tons has been officially opened last week when the processing fee was only 200-250 yuan/ton!
Involving production capacity of more than 10 million tons
PTA fought hard despite serious losses
It is understood that the price of acetic acid has skyrocketed this year. Based on the current price increase of acetic acid, steam, electricity and packaging bags, which is around 6,000 yuan/ton, the current PTA processing cost is at least above 500 yuan/ton. However, the processing fee calculated based on the current price is only 200-250 yuan/ton, which means that the entire PTA industry is currently in a state of serious loss.
Against this background, PTA factories have successively announced maintenance plans since last week. The current December maintenance plan includes 2.5 million tons of Fujian Baihong Petrochemical, 2.25 million tons of Hengli Petrochemical, and 2.5 million tons of Honggang Petrochemical and Yiyi Petrochemical have been stopped to reduce their load. Shanda Chemical produces 6 million tons, involving a production capacity of more than 10 million tons.
The main reason for the previous decline in PTA was not only the sharp drop in oil prices, but also the weakness on the demand side: under inventory pressure, some mainstream downstream polyester factories jointly reduced production by 25%. Affected by this, the polyester load dropped to around 85%. , the weaving load dropped to around 64%, both at low levels. But judging from the current situation, the probability that the downstream polyester load will continue to decline is low. In addition, in terms of terminals, terminal raw material inventories and gray fabric inventories are both at relatively low levels, and downstream stocks are still expected to be replenished after the year. If the downstream begins to replenish its reserves, a bottom-up positive feedback will be formed, which will have a more lasting effect on the market.
Epidemic control upgrades in many places in Zhejiang
The impact is transmitted from raw materials to downstream polyester links, which will benefit the market in the short term.
On the other hand, overall, the performance of the three polyester varieties on the pallet in recent days has been stronger than that of other chemicals, which is also related to the impact of the epidemic.
Since December 5, as of 3 p.m. on the 12th, a total of 138 confirmed cases and 1 asymptomatic infection have been reported in Ningbo, Shaoxing and Hangzhou in our province. Among them, Ningbo has reported a total of 44 confirmed cases; Shaoxing has reported a total of 77 confirmed cases and 1 asymptomatic infection; and Hangzhou has reported a total of 17 confirmed cases.
It is understood that the three areas where Zhejiang’s prevention and control have been upgraded are mostly chemical industry areas, gathering textile raw material production, downstream polyester consumption, including the aromatics industry, polyolefin industry, and hazardous chemicals production. Among them, the Zhenhai area is an important petrochemical base in China, and its management and control upgrades have a greater impact on some chemicals.
Judging from the regional control requirements, most of them have put forward requirements for petrochemical production companies to shut down, suspend production, and reduce burdens. The reporter learned from the local situation that the Zhenhai area has a 1.6 million-ton PX device of Zhongjin Petrochemical and a 750,000-ton PX device of Zhenhai Refining and Chemical, accounting for 7.63% of the total PX production capacity; both sets of devices are currently in normal production. The Zhenhai area has Yisheng New Materials’ 3.6 million-ton PTA device, accounting for 4.87% of the total PTA production capacity. Due to the impact of the epidemic on logistics, the new material device is currently reducing its load. In terms of ethylene glycol, Zhenhai Petrochemical’s 650,000-ton ethylene glycol unit and Fude Energy’s 500,000-ton ethylene glycol unit account for 5.53% of the total ethylene glycol production capacity. Among them, the Zhenhai Petrochemical unit is in normal production, but due to transportation obstruction, EO/ The EG is switched and the EG load is increased; Fude has already stopped for inspection in the early stage.
After the outbreak, as the Zhenhai area is an important petrochemical production area, it has an impact on the polyester raw materials PTA and ethylene glycol. In addition, controls in Hangzhou and other places are also upgrading, and the impact is transmitted from raw materials to downstream polyester links. Overall, the epidemic affects logistics. This will affect the flow of products in each link to the market, which will be a beneficial impact. Its duration will depend on the control of the epidemic.
The market enters the Spring Festival season
The market situation may be more related to the pre-holiday stocking situation of downstream companies.
According to Pang Chunyan, an analyst at SDIC Essence Futures, the impact of this round of epidemic is expected to be gradually eliminated around New Year’s Day, when the New Year’s Day holiday will begin, followed by the Spring Festival, and demand is expected to gradually weaken. The PTA unit gradually recovered from the decline in December, and new ethylene glycol units are gradually entering the mass production period. Overall, polyester raw materials will usher in a seasonal accumulation cycle after January, and the impact is mainly reflected after the Spring Festival. “Before the Spring Festival, in addition to the key factor of oil prices, price fluctuations are more related to the pre-holiday stockings of downstream companies. If the Spring Festival is celebrated on a large scale across the country, there may be a Spring Festival stocking market before the holiday. How the specific market interprets it depends on Let’s look at the evolution of the epidemic control situation.”
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