Xinfengming issued an announcement on the evening of October 30, saying that after the preliminary equipment installation, stand-alone debugging, linkage debugging, cold debugging, hot debugging, and band debugging, In the material debugging and other stages, Dushan Energy, a wholly-owned subsidiary of the private placement investment project, has entered trial production with an annual output of 2.2 million tons of PTA project, and the PTA market may be in trouble again.
After entering July this year, the market situation of PTA, whether it is price, profit or inventory, can almost be described as “a sharp decline”.
In terms of price, PTA’s internal quotation fell from more than 6,800 yuan/ton to 4,845 yuan/ton on October 31 in just 4 months, a drop of nearly 200 yuan/ton.
In terms of profits, PTA profits plummeted from 1,787 yuan/ton in early July. The current amount is less than 100 yuan.
In terms of inventory, although now through measures such as equipment maintenance, PTA’s total social inventory It is slightly lower than before, but still exceeds 1.2 million tons, which is at a high level.
It is not difficult to see from the above data that the overall momentum of PTA today is bearish, but in Under such a bearish environment, starting from the fourth quarter of 2019, a new wave of PTA device production will begin again.
When PTA’s prices and profits have hit rock bottom, new devices have to be installed one after another. Are you ready to get started? Are the bosses “fooled”? But things are not that simple.
I never expected that the textile market would be so weak this year
It is undeniable that when the planning and construction of the installation started, the PTA market was still weak. In a “blue ocean” state.
Take the Xinfengming plant that has just been put into production as an example. The plant started construction in May 2017. At that time, the old wave of PTA plants had just ended, and the market was basically optimistic about the newly put into production. It can be digested, but considering that the new polyester filament device will be put into production in the next two years, PTA in 2018 and the first half of 2019 is likely to be in a tight supply and demand state. Under such market conditions, it is appropriate for the polyester “big guys” to start a new round of PTA installations.
Originally, due to the transfer of water-jet looms, the production capacity of water-jet looms has increased very quickly, and the weaving market in the textile industry has been good in the past two years. If things develop normally, it should be that after two years of stagnant production capacity, the market is extremely hungry for PTA, and the commissioning of new equipment is like a “rain in the face of a long drought”, giving the market a “shot in the arm”.
But what polyester manufacturers never expected was that the weaving market would be so bad this year. Of course, the poor market situation this year is mainly due to external factors such as the overall decline of the international economy and the intensification of Sino-US trade friction. It is almost impossible to predict two years in advance. It can be said to be a “crime other than war.”
To use a popular saying nowadays, the polyester big guys were “fooled”!
But from another perspective, even if they know in advance that the current market situation will get worse, there is a high probability that leading polyester companies will still put into production as planned. Why is this?
Open up the entire industry chain, be self-sufficient and resist risks
First of all, it is to open up the entire industry chain, reduce operating costs, and resist risks.
Take Xinfengming as an example. The 2018 annual report data shows that in 2018, Xinfengming purchased 2.7116 million tons of PTA.
Beginning in July last year, the price of PTA began to skyrocket. The spot price of PTA even exceeded 10,000 yuan/ton. Although polyester longThe price of � is also rising rapidly, but because it directly connects with weaving companies, the increase in polyester yarn has never kept up with PTA, which ultimately led to a decline in polyester yarn profits.
The annual output of the first phase of Dushan’s PTA device is 2.2 million tons. Once it is fully put into production, it will largely enable Xinfengming’s self-supply of PTA raw materials and reduce costs. Polyester cost. If we encounter the polyester market situation like last year again, the company’s profits will be greatly improved.
Normal production and maintaining one’s own right to speak
In addition to some companies seeking to open up the entire industry chain and eliminate risks, there are also some leading chemical fiber companies that want to maintain their voice in the industry.
In 2018, due to the sharp rise in polyester raw material prices in the third quarter, the profits of leading polyester companies have increased significantly. Taking Hengli Group as an example, Hengli Shares disclosed its 2018 performance increase announcement stating that in 2018, it achieved a net profit of 3.6 billion yuan attributable to shareholders of listed companies, a year-on-year increase of 109.38%, and the main profit point is PTA. PTA is in The high profits in 2018 are eye-catching.
China’s PTA nominal production capacity pattern in 2018
As of 2018 In September, the PTA industry production capacity reached 50.75 million tons, mainly concentrated in leading chemical fiber companies such as Yisheng, Hengli, Fuhaichuang, Tongkun Petrochemical, and Huabin Petrochemical. With the arrival of a new wave of PTA equipment production, the original leading chemical fiber companies will inevitably follow up to a certain extent to continue to ensure their own voice in the industry.
To put it in layman’s terms, if others have put it into production, wouldn’t it be a loss if I don’t put it into production?
The market may pick up in the future
Although the current PTA market performance is not satisfactory, there is a high probability that it will pick up in the future.
If the good market situation in the weaving market last year was an “accident”, this year’s bad market situation can also be said to be an “accident”. It was caused by overcapacity, Sino-US trade friction, and the global economy. Decline and other factors came together to create the situation.
Now that Sino-US trade negotiations have produced certain results, a large number of weaving companies are also actively transforming and upgrading. The editor personally believes that by next year, the weaving market will pick up to a certain extent compared with this year. , then PTA and other polyester products will be able to return to a normal track.
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