Affected by the continuous correction of cost-end crude oil prices, the polyester sector has still shown a weak trend recently, with PTA leading the decline in the polyester sector. On the 8th, the PTA trend showed an accelerated downward trend, hitting a new low since mid-June. The main contract fell to as low as 4,744 yuan/ton, a single-day drop of nearly 3.5%. In less than a month, PTA has fallen by more than 12%.
The giant overhaul has not yet materialized
PTA operating rates soared
As for the recent sharp weakening of PTA prices, industry insiders believe that it is due to the resonance of fundamentals such as falling costs and weakening supply and demand. result. The continued weakening of costs is the direct cause of this round of PTA decline.
Although the recent hurricane in Mexico has boosted oil prices to a certain extent, compared with the highs in the previous month or two, international crude oil prices have already experienced a larger decline. A drop in magnitude. What’s more worth mentioning is that due to the market’s negative expectations, the overall trend of PTA’s direct upstream raw material PX will be weaker than that of crude oil and naphtha, the source of the industrial chain.
From a price comparison point of view, the current price difference between PX and naphtha has dropped to around US$225/ton. Raw materials continue to weaken, and it is naturally difficult for PTA itself to obtain the market’s price increase expectations.
Secondly, from the perspective of the supply and demand fundamentals of PTA itself, the current situation of this variety is not optimistic. According to market news, a 1.2 million-ton unit in the northwest that was shut down in early August has started discharging materials recently. However, the maintenance of Yishenghua 225 and Hengli 2.5 million-ton units has been delayed, which caused the PTA operating rate to suddenly skyrocket. to around 80%.
The corresponding downstream polyester operating rate has suffered due to weakening orders and profit losses. Factors such as compression are in a low operating state. The dislocation of upstream and downstream construction has caused PTA’s September balance sheet to reach the turning point of accumulated inventory for the first time, and prices will naturally be in an atmosphere of “more falls than rises”.
Frequent promotions of polyester overdraft later demand
The downward trend of PTA will challenge the bottom line of processing fees
Judging from the current fundamental situation, PTA will enter a continuous accumulation cycle, and profits will be compressed to levels near the profit and loss line.
From the perspective of processing fees, it is currently around 450, which has fallen to the low of the year and is also lower than the same period in previous years. If it is lower than 400, the devices below 1 million tons in the market will fall into trouble. Losses may lead to increased shutdowns for maintenance and lower operating rates. Last Wednesday, the PTA futures 01 contract fell sharply and broke through 4800, setting a new record in the near future. Open interest and trading volume increased significantly. There were large short positions in PTA. The current downward trend formed by PTA will continue to suppress processing fees until some high prices are forced. Cost production capacity has been stopped, but the processing fee is relatively limited. It is estimated that around 300 is the limit.
In addition, from the perspective of downstream polyester, polyester products, mainly polyester filament, passively follow the price adjustment of raw materials, which affects the purchasing sentiment of downstream merchants. Downstream purchasing is cautious, production and sales After days of sluggishness, filament companies have been forced to cut prices and promote sales. Take polyester filament as an example. Recently, there have been multiple rounds of concentrated preferential promotions, and downstream buyers have bought at low prices. Polyester filament companies have experienced destocking effects in the short term. However, pulse-type production and sales have overdrafted demand in advance. After the event, the market has become increasingly deserted, and with the The frequency of promotions has accelerated, and promotion time points have often become nodes for downstream purchasing. Because market outlook is pessimistic, users are purchasing more on demand to alleviate the pressure on raw material inventory. When terminal demand is weak and production and sales continue to weaken, the polyester link uses price reduction promotions to achieve the purpose of destocking and promote production and sales in the short term, but it cannot improve the contradiction between supply and demand.
Overall, under the expectation of weak supply and demand, the PTA market lacks strong upward momentum and may continue its weak adjustment in the short term. Whether there will be a turning point in the later period requires attention to changes in cost and self-regulation of supply and demand. </p
