On the afternoon of January 9, the Ministry of Commerce released the latest news: At the invitation of the United States, Liu He, member of the Political Bureau of the CPC Central Committee, Vice Premier of the State Council, and Chinese leader of the China-U.S. Comprehensive Economic Dialogue, will lead a delegation from 13 to 15 of this month. Visited Washington and signed the first phase of the economic and trade agreement with the United States.
Amidst the turbulent international political situation, Sino-US relations have received substantial positive news. This has affected the recent ups and downs, How has the polyester market responded to the ever-fluctuating polyester market?
First, let’s review the polyester market situation before the good news from China and the United States came out:
Recently, tensions between the United States and Iran have continued to escalate, adding to the already weak market situation. The unsatisfactory polyester market received a shot in the arm. Crude oil surged, and PTA, MEG, and polyester filament continued to rise. The polyester market was in a “New Year red” trend.
However, the sharp rise was followed by a sharp fall.
On January 8, after Trump’s mild statement of “embracing peace” eased market tensions, Brent crude oil fell 4% to $65.54 per barrel, and WTI crude oil fell 4.9% to $65.54 per barrel. At $59.61 a barrel, it was the first time it fell below $60 a barrel since December 16.
After crude oil plummeted, PTA and ethylene glycol also began to fall. As of the closing on the afternoon of the 9th, the main PTA 2005 contract of Zhengzhou Commercial Exchange closed at 4,910 yuan/ton, a decrease of 2.77%;
Dashang The main MEG 2005 contract closed at 4,769 yuan/ton, a decrease of 0.73%.
Polyester filament prices have been mixed, driven by upstream costs. In the past few days, polyester raw materials have surged, and the prices of polyester filament products have begun to rise. However, production and sales have only exceeded 100 twice. Subsequently, the price focus of various polyester filament products was mainly stable.
China-US trade has been going back and forth for almost two years. From time to time, some good or bad news will come out, and the market has become accustomed to it. Therefore, every time there is news, we always wonder if it is another “wolf crying?” But this time, China and the United States have a clear time to sign an agreement on trade. Boosted by major positive news, the polyester market is calm.
At the night of the 9th, the main 2005 contract of PTA of Zhengzhou Commodity Exchange closed at 4,920 yuan/ton, a decrease of 0.69%;
The main 2005 contract of MEG of Dalian Commodity Exchange closed at 4,783 yuan/ton. Closed and remained stable.
At the same time, while polyester is “calm”, polyester filament still maintains its original appearance and cannot rise! Why?
PTA and MEG have surged and plummeted, and cost support has been weak
Recently In the past few days, under the influence of the sharp rise and fall of crude oil, PTA and MEG futures also fluctuated. As raw materials for polyester filament, the prices of PTA and MEG fluctuate frequently and greatly, and the price support for polyester filament is also weak.
Although polyester stock is low, the load is high
From China’s silk capital According to online statistics, the overall inventory of the polyester market is now concentrated at 9-18 days; in terms of specific products, POY inventory is around 3-7 days, FDY inventory is around 7-12 days, and DTY inventory is around 14-19 days About days. It can be said that the current polyester inventory is at a low level in recent times.
If we look at the inventory alone, polyester filament yarns still have high prices. However, we can find that currently, polyester filament yarns are The load is not at a low level. As of January 3, the polyester filament load was around 76%, close to the same period in 2018 and 2019. You must know that the textile market in 2018 and the beginning of 2019 was still remarkable, and naturally there was a greater demand for polyester filament. However, now that the market has come to an end and it is approaching the Spring Festival, the polyester filament load has not declined. It can be seen that in the next period of time, there is a high probability of polyester stock being accumulated, which will exert pressure on prices.
Polyester yarn itself has overcapacity and it is difficult to raise prices
As can be seen from the table below, my country’s total polyester filament output in 2019 was 2.9385 million tons, an increase of 194.5 million tons from 2.744 million tons in 2018, an increase of 7.08%. It is reported that the new production capacity during the year is still mainly concentrated in large polyester factories, mainly POY, including Tongkun Group with 1.2 million tons, Xinfengming Group560,000 tons, Hengyi (Yipeng Jiaxing) 250,000 tons, Fujian Jingwei 200,000 tons, Lixin Chemical Fiber 80,000 tons, etc. Polyester yarn will face overcapacity.
At the same time, as major polyester factories have successively launched 10-million-ton refining and chemical integration projects, the “big refining and chemical industry” The time is coming. 2020 will be a year of rapid growth in the production capacity of polyester raw materials such as PTA, PX, polyester filament, etc. A large amount of new production capacity needs to be digested, and there is a high probability that it will suppress the prices of various polyester products.
Whether polyester prices can rise or not, one of the most important factors is still the demand from downstream weaving factories. In 2019, the most important factors for the poor textile market conditions are overcapacity and Sino-US trade. Now Sino-US trade has undergone substantial changes, and an agreement is about to be signed. This is a major benefit to the textile market after the beginning of the year. If there are obvious signs of improvement in the textile market, it is expected that the price of raw polyester filament will increase. </p
