In previous years, July and August were the most frequent times for maintenance of PTA equipment, and equipment maintenance could also push up its price in a short period of time. But this year, the PTA market is taking an unusual path and changing its style from previous years.
Recently, multiple PTA units have been put into operation, restarted, and maintenance plans have been postponed:
A new PTA device in Northeast China has been officially put into operation. Half of the production lines will be opened in June, involving a production capacity of 1.25 million; the other half of the production lines are planned to be opened in July;
Hengli Petrochemical’s 2.5 million-ton PTA unit was put into operation, and half of the production lines were opened in June and July;
A 1.2 million-ton unit in the northwest was shut down for maintenance during the Dragon Boat Festival Ton PTA unit warms up and restarts;
A 600,000 ton PTA unit in East China was originally scheduled to be inspected at the end of June, but is now postponed;
Another 1.4 million-ton PTA unit in East China was originally scheduled for maintenance for 2 weeks in late July, but it has been postponed to August;
Yisheng Ningbo 2.2 million The maintenance of the ton device was expected to take 2-3 days in July, but it has been postponed.
PTA is stuck in the dilemma of high inventory, high load and low price
With the commissioning, restart, and postponement of maintenance of the equipment, there is more room for increase in PTA operating rate. As of the 3rd, the weekly average of PTA The load is around 80.9, which is an increase of about 2.9% from the load of about 78% in the same period last month.
As of the end of June, PTA’s social circulation inventory was around 2.25 million tons. In July, the PTA load increased again compared with the previous period, and the supply increased, and PTA will return to the accumulation stage. . Under the pressure of high inventory and high load, PTA prices will continue to be under pressure.
Currently, the internal price of PTA is around 3,560 yuan/ton. The editor pulled up the PTA internal price trend chart to 2008, but did not find a lower price than now. This year, the lowest internal price of PTA was 2,945 yuan/ton, which was caused by the May crude oil futures price falling to a negative value, and then fluctuating upward. It can be seen that the price of PTA is now at a historical low, and the room for decline is limited.
PTA still puts into operation and expands despite weak fundamentals, The maintenance is postponed. In addition to the fact that the production plan itself is difficult to postpone due to various factors, the more important point may be that PTA is still profitable.
From October last year to March this year, PTA was basically in a loss-making situation. It was only in April that it began to turn a profit. Even in early June, PTA’s cash flow reached It reached a high of around 400 yuan/ton, and then fluctuated in a range, but was still profitable. Under the double attack of the loss-making situation of upstream PX and the poor demand for downstream polyester, PTA can still make a profit and naturally will not reduce the load easily.
Although terminal demand has always affected the polyester market is the most important factor, but under this year’s special epidemic situation, terminal demand has not boosted the polyester market as much as the upstream cost side. PTA is the main raw material for polyester filament, and its price can boost the polyester market to a certain extent. However, the price of PTA is under serious pressure due to oversupply, so it is naturally difficult to increase the price of polyester yarn.
Polyester filament continues to fall in price but cannot be sold
At the beginning of July, polyester filament began to fall and fall. Specifically, the price of polyester filament FDY products is around 5,750 yuan/ton, the price of POY products is around 5,220 yuan/ton, and the price of DTY products is around 6,850 yuan/ton. Compared with the same period in previous years, there was a decrease of more than 3,000 yuan/ton.
We all know that in the second half of 2018, the textile industry will undergo environmental protection rectification The prevailing epidemic situation has led to limited market capacity, crazy out-of-stock of conventional products, long queues of orders from weaving manufacturers, and even refusal to accept orders. The textile industry has ushered in the “win-win” era of “every machine rings, and gold is worth thousands of dollars”. Boosted by the strong demand for weaving, the price of polyester filament began to rise sharply starting in July 2018. The price of FDY 150D product once shot up to a high price of about 12,350 yuan/ton. In 2019, due to the serious consequences of overcapacity and the market decline, polyester prices also began to fall, but they still remained at a high level. It can be said that polyester prices at that time just returned to a normal level.
This year, due to the impact of the epidemic, terminal demand has dropped sharply, making it difficult to form an effective demand base for polyester filament, causing polyester filament prices to fall again and again. When demand is difficult to recover for a while, cost-end PTA is also unable to provide strong support for polyester filament, and the price of polyester filament has repeatedly hit the bottom.
While the price of polyester yarn continues to open a downward channel, production and sales also continue to In the downturn, weaving manufacturers have an obvious wait-and-see attitude and are operating cautiously.��. Polyester production and sales have been unsatisfactory since June, with the market exceeding 100 only three times. It continued into July, and it was still difficult to increase production and sales.
On the 1st, the average production and sales of polyester yarn in Jiangsu and Zhejiang were around 30%-50%;
On the 2nd, the polyester yarn in Jiangsu and Zhejiang regions The average production and sales continue to be around 30%-50%;
On the 3rd, the average production and sales of polyester yarn in Jiangsu and Zhejiang dropped to around 30%-40%.
At the beginning of July, PTA and polyester filament performed poorly. Well, as the off-season atmosphere deepens, is there the possibility of PTA and polyester filament falling further?
The editor believes that there is a high probability that it will
1. For PTA, PTA is currently in a situation of oversupply, suppressing Its price, but there are still many sets of PTA units expected to be put into production in the second half of the year, the supply will further increase, PTA will enter the inventory accumulation cycle, and the price may further decrease. When the price has nowhere to go, PTA’s processing fee may be profitable.
2. For polyester filament, the current weaving manufacturers themselves It has entered the traditional off-season, and this year is a special period. The off-season is even weaker. Currently, the operating rate of looms in Shengze remains at around 70%, while the inventory of gray fabrics has risen to about 44 days. Most weaving manufacturers have stated that they have plans to reduce production in the future. The operating rate will further decrease, and the demand for raw polyester yarn will naturally decrease. At the same time, the inventory of polyester factories has risen to about 34 days, and it is already in a state of accumulated inventory. Coupled with the weakening demand, polyester yarn prices are difficult to stabilize.
From an overall point of view, at this stage and in the short term, PTA and polyester The filament market has been suppressed, and there is no major reversal. However, we must also pay attention to the fact that crude oil production is still being reduced, and public safety and health incidents have improved compared with March and April. If there is news guidance in the future, It is not impossible that PTA and polyester can make breakthroughs. </p
