Polyester Support Limited PTA Will Return To The Downward Trend

Polyester production and sales are booming, and the peak season may continue to October

After a recent visit to several polyester factories in East China, the author found that the polyester industry has improved significantly from August. Polyester inventory remains low, and there is basically no financial pressure; The operating rate of polyester enterprises surveyed is more than 70%, and the highest is 100%. The weaving process of polyester downstream customers is similar. The overall inventory is low, and the sales are good. Some weaving enterprises with good brands are profitable, and the sales of grey fabrics have been scheduled to the end of October.

From the data tracked by the author, the profit of polyester industry has risen sharply since the beginning of August, and the profit level of polyester DTY in mid September has reached a two-year high. In fact, the improvement of polyester profit was not achieved through price increase, and polyester prices also fell recently. However, PTA and MEG in polyester raw materials fell more, and the product price fell less than that of raw materials, leading to a rapid rise in polyester profits. The overall operating rate of polyester in Jiangsu and Zhejiang provinces rose from 69% at the end of August to 71% in the middle of September, while the operating rate of terminal weaving was stable at 78% for three consecutive weeks. A considerable number of polyester factories believe that it is good that the current high production and sales of polyester can continue to the middle and late October, and it is a big probability that it will gradually decline. Good production and marketing of polyester link is the main support for PTA price.

PX Likong continued fermentation, PTA supply increased

This year, new production capacity in PX Asia has been released successively in the second quarter, and PX supply will also gradually increase. On August 11, the price difference between PX and naphtha was as high as 550 dollars/ton, and now it has dropped to 350 dollars/ton. Even so, PX production is profitable. Judging from the operating rates and maintenance delays in China and Asia, PX supply It will continue to increase, and PX prices are likely to continue to decline under the situation of continued weakness of crude oil.

　　PTA union It continued to play its role in the first half of September, and the PTA operating rate remained below 60%. Calculated according to the operating rate of 71.4% polyester, the load to maintain the balance between supply and demand of PTA is 63%, and the operating rate below 60% needs to be destocked. However, just recently, PTA factories have resumed production, and the new production capacity of Sanfangxiang has also started commissioning. The PTA operating rate has suddenly risen to 65%. If this trend continues, PTA's social inventory will increase again. Throughout July and August, although PTA factory strictly controlled the quantity, PTA social inventory increased by about 250000 tons because of the negative growth of polyester output. If the social inventory increases again in September, the surplus inventory will become the direct driving force of PTA price decline in the market where spot trade is already scarce.

In short, PTA The root cause of the market decline is still that the capacity expansion of the entire industrial chain is slower than the growth rate of downstream demand. The crude oil market is well supplied. The refinery maintenance in September and October and the continuous expansion of the current price difference in Brent period mean that the crude oil will continue to be weak and oscillatory. The operating rate of PX is still rising, and the decline of PX has not changed. At present, the good production and marketing and rigid demand of downstream polyester are the strongest support for PTA. In the short term, PTA will oscillate in a narrow range between 6200 and 6400 points. As downstream demand turns weak, the PTA market will return to a downward trend.