In 2019, The PX Project Put Into Operation 200 Dollars / Ton Of PX Profit To Downstream PTA And Polyester Pfer.

In March 24th, a good news came from Hengli 20 million ton / year refinery and chemical integration project. The project has successfully opened up the whole production process, producing gasoline, diesel, aviation kerosene, PX and other products, and produced stable operation.

It is reported that the project from debugging, functional intermodal pportation to open the whole process, set the industry's fastest record.

It is worth mentioning that the actual progress and speed of the Hengli refining and chemical project are deeply concerned by all parties.

Hengli shares has been leading the industry with the lead in the whole industry chain business from "one drop of oil" to "one thread", and has entered a new stage of synergy, integration and balanced development of refining, petrochemical and polyester.

In this project, PX has a capacity of 4 million 500 thousand tons. At present, 2 million 250 thousand tons are running normally.

Market participants expect that according to the current production situation, Hengli refining and chemical projects in 2019 will achieve an annual output value of over 150 billion yuan and a profit tax of 38 billion yuan.

As we all know, PX is the source of the polyester industry chain, and also the tail of the aromatics industry chain. As the role of the central hub, the operation of the upstream and downstream markets is related to PX, and the increase of Hengli new device has a huge impact on PX's own supply and downstream polyester raw materials.

For the time being, Hengli Petrochemical's Dalian refining and chemical integration project includes PX production capacity of 4 million 500 thousand tons / year and output of qualified products in March 24, 2019. The device has two PX production lines. At present, a set of 2 million 250 thousand tons / year PX production line is put into operation. Although it is put into production at half capacity, it has become the largest PX production enterprise in the country, accounting for 16.03% of the total domestic capacity, and domestic supply has begun to increase significantly.

Hengli Petrochemical itself has 6 million 600 thousand tons / year PTA plant, its initial PX capacity design is just to meet the needs of its own PTA production, and the PX produced directly passes through the pipeline to the adjacent PTA factory. The raw material of PX before the enterprise is purchased by local PX enterprises, most of which are obtained through import, so the import volume of PX will be greatly reduced, and the second PX production lines will only be put into production in the later stage. The Hengli petrochemical industry will basically achieve 0 acquisition in the near future, because the import of PX is reduced, and the export countries of Japan and Korea, such as Japan and Korea, are under pressure. The higher profits of the India are normal.

Hengli petrochemical PX production is just the beginning.

At the same time, Hengyi Petrochemical is located in Brunei's 22 million tonne PMB petrochemical project, which involved 3 million 500 thousand tons of PX capacity in the two phases, of which 1 million 500 thousand tons are scheduled for commissioning in the two quarter of 2019.

Sinochem Hongrun is located in Weifang's PX plant with a capacity of 800 thousand tons. It is scheduled to be commissioned in June 2019 and put into operation in July.

Sinopec Hainan refinery two phase 5 million tons refining and chemical project, involving PX capacity of 1 million tons, plans to test in June 2019, is expected to end this summer, China's PX production capacity will be more than 5 million tons.

In addition, the first phase of Zhejiang Petrochemical Company, the first phase of the joint petrochemical project and the two phase of CNOOC Huizhou refining and chemical industry, respectively, involve 4 million tons of new PX capacity, 1 million tons and 800 thousand tons, all of which are planned to be put into operation in the fourth quarter of this year.

If all goes well, China's PX capacity will exceed 10 million tons at the end of this year.

PX's capacity delivery will affect the market through two aspects of supply and demand internalization. One is Sinopec, Hongrun, Hainan refining and Huizhou refining and other petroleum and petrochemical enterprises directly supplying their PX products to the market. The second is internal digestion of Hengli, Hengyi and Zhejiang petrochemical enterprises, reducing the purchase of PTA raw materials within the enterprise, which is reflected in reducing demand.

Hengli, Hengyi and Rongsheng and Tong Kun of Zhejiang Petrochemical Company are leading enterprises in PTA production in China. At present, Hengli has 6 million 600 thousand tons of PTA capacity, 5 million tons under construction or proposed, 13 million 200 thousand tons of Yisheng PTA and 2 million 200 thousand tons under construction, and 3 million 700 thousand tons of PTA capacity and 2 million 400 thousand tons under construction.

In 2019, Hengli, Hengyi and zhe Petrochemical produced capacity to meet half of the raw material demand of their existing PTA production.

In the short term, domestic PX production capacity still can not fully meet the domestic PTA production demand, but it can ease the tight supply and demand situation of domestic PX, and may squeeze the import market.

If Hengli, Hengyi and Hainan refining and chemical enterprises can start production on schedule, it is expected that the tight supply and demand pattern of PX will be improved in the second half of this year.

If the four quarter production is also relatively smooth, the domestic PX capacity benchmark will reach 25 million tons in 2020, the domestic PX production will be close to 20 million tons, import dependency to about 30%, PX supply and demand balance or loose.

As the overall pattern of the industry is changing, it is expected that the PX will be stronger or weaker in the second half of the year. PX's original excess profit of $200 will be cut off in the second half of 2018.

The pfer of profits will be realized through the price cut from top to bottom, but the process of each stage may not be consistent. The upstream PX may be a double drop in price and profit, while PTA and polyester will show a decline in prices and a rise in profits.

In the first half of 2019, PX will still be strong by the tight supply and demand of the industry.

In mid 2019, with the launch of PX projects such as Hengli, Hengyi and Hainan refining and chemical industry, the momentum of PX will be weakened. The PX industry will enter a pitional stage from supply and demand to supply and demand balance. The excessive profits at the PX side will bear the brunt, and PX profits will be pferred to PTA and pet terminals through price cuts.

In the fourth quarter of this year, if a new round of PX production capacity can be put on schedule, PX will achieve a balance between supply and demand. It is expected that at that time, at least 200 US dollars / ton of PX profits will be pferred to the downstream PTA and polyester terminals.

(source: Baocheng futures, Jin Lianchuang)