As the upstream of the polyester industry chain, fluctuations in crude oil have a cost fluctuation effect on the industry chain.
On November 29, international crude oil fell sharply due to the escalating situation in Iraq and a new high in U.S. crude oil production. On that day, the January 2020 West Texas Light Oil futures settlement price on the New York Mercantile Exchange was US$55.17 per barrel, a decrease of US$2.94, or 5.1%, from the previous trading day.
Affected by the negative factors of crude oil, PTA and MEG futures suddenly changed on the night of the 29th and closed in a downward trend.
Since November, polyester raw materials have not performed as well as People want it. The performance of futures is poor, and the price is also “not strong”.
Recently, “buying the dip” has become common, but how low is this “low”?
PTA price exceeds 3-year low, profit loss exceeds 1,800 yuan/ton
PTA, once the “polyester giant” in the industrial chain, “encountered an unexpected event” this year. As of now, the internal price of PTA is around 4,775 yuan/ton, which is the lowest level in more than three years. The continuous decline in prices has also caused profits to continue to shrink. The highest profit of PTA during the year reached 1,787 yuan/ton, but currently PTA is in a loss-making state, with a profit difference of more than 1,800 yuan/ton.
Ethylene glycol stocks are low, but the internal price is The lowest in the same period in 4 years
Ethylene glycol futures have been weak since the beginning of this year and improved slightly in the second half of the year, but have recently returned to decline. As the futures price drops, the internal price is also declining. As of now, the internal price of ethylene glycol is around 4,712 yuan/ton. It can be seen from the figure that the current internal price is close to the low of the year. At the same time, it is also at the low of the same period in four years.
So, there is only one month left in 2019 Do you think there is still a chance for polyester raw materials to “turn over”?
The 3.7 million tons PTA device is planned to be put into operation by the end of the year, and the supply will be further expanded
With the continuous expansion of PTA production capacity, PTA’s “hegemony” position in the polyester industry chain has begun to change. At present, there is a rolling maintenance plan for the 2.4 million tons PTA unit of Hailun Petrochemical in December, and it is scheduled to be shut down for 15 days. Although there is a unit maintenance, it will only have a short-term impact on the supply side; and, before the end of December, Hengli Petrochemical 250 The 10,000-ton PTA plant and the 1.2 million-ton PTA plant of Zhongtai Chemical are scheduled to be put into operation, which will suppress the PTA market from both the supply side and the psychological level.
At the same time, as large-scale private refining and chemical giants such as Hengli Refining and Chemical Co., Ltd. have successively put into operation, the PX industry pattern has undergone tremendous changes, and PX has become the largest expansion of chemical products in the next few years. variety. The supply of PX continues to increase, and the price drops accordingly. The current profit has been lost to US$147/ton. With the cost side collapsing, it is difficult for PTA prices to rise.
Ethylene glycol stocks hit new lows during the year, but at the end of the year Expectations for the commissioning of new units still exist
Starting from June, ethylene glycol stocks have entered a downward channel. At present, ethylene glycol terminal stocks are around 425,000 tons. , close to the lowest value since 2017.
At the same time, from the supply side, ethylene glycol in December The maintenance capacity involves 1.67 million tons, and the commissioning of new equipment at the end of the year has been delayed. With tight supply, low inventory, and good fundamentals, ethylene glycol prices may remain stable in the short term.
But in the long run, the chance of a substantial comeback is not great . It has now entered December. According to the plan, 1.3 million tons of ethylene glycol units will be put into operation. Although it has been delayed, 3.9 million tons of ethylene glycol units are still expected to be put into operation before the end of next year, and the supply will be expanded by then. The tight spot supply of ethylene glycol will change, and it will be difficult for ethylene glycol prices to rise under loose supply and demand.
Whether it is PTA or ethylene glycol, except for the supply end , downstream demand is also one of the important factors that determine its “life and death”.
Polyester filament yarn, as the downstream of the polyester industry chain, has been in a weak state this year. Polyester filament manufacturers, which once had the most say in their hands, are facing deepening hidden dangers this year due to overcapacity., began to gradually accumulate inventory. Amid insufficient downstream demand, polyester filament inventory reached a high level since 2014.
Inventory continues to increase, and prices continue to fall. Taking polyester filament FDY50D/24F as an example, the current price has fallen to a three-year low. As the weaving end began to reduce production at the end of the year, orders were gradually coming to an end and under financial pressure, the demand for raw polyester filament was not strong. Feedback to PTA and ethylene glycol has also reduced demand.
To sum up, the editor believes that it will be difficult for polyester raw materials to turn around in the short term!
This year Look, there is not much chance of PTA and ethylene glycol turning around, but perhaps for polyester raw materials, whether they turn around or not is no longer important. Being able to reduce inventory and collect some funds is already a “good thing”… ..
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