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The ICE Brent November contract rose 3.21 last week The US dollar (8.06%) settlement price closed at US$43.15/barrel. As the price of crude oil fell sharply from US$46.53/barrel at the beginning of this month to a low of US$39.13/barrel, the price of polyester raw materials also fell. However, as the price of crude oil rebounded to US$43/barrel, PTA and EG rebounded. The intensity is limited, and thus its processing fees have been compressed. PTA processing fees have dropped from the highest processing fee of around 680 yuan in early September to the current level of around 580 yuan. The PX-naphtha price difference recovered slightly and fluctuated around 160 yuan. Regarding the start of PTA construction, Yisheng Ningbo’s 2.2 million-ton unit restarted discharging materials on September 18, and Luoyang Petrochemical’s 325,000-ton unit began discharging materials on September 17. In addition, the fourth quarter is about to enter, and the 2.2 million tons unit of the second phase of Dushan Petrochemical Project is about to start. Generally speaking, there is greater pressure on PTA supply.
Recently, the cash flow situation of the polyester end has been poor, and almost all areas have fallen into losses. Taking POY as an example, it is estimated that its profit has dropped to -350 yuan/ton (different manufacturers , model products vary) nearby. Last week, the average weekly start-up load of polyester dropped slightly by 0.54% to 92.08% from the previous week, and the start-up load of direct spinning filament increased by 0.38% to 83.62%. Polyester inventory is basically the same as the previous week and is relatively healthy. September has entered the traditional peak season for downstream textiles. Downstream orders have improved slightly, yarn gray fabrics have been destocked significantly, and polyester cash flow is expected to be restored to a certain extent in the later period. The operating rate of polyester is likely to remain high.
Generally speaking, the current resistance to the rebound of PTA prices mainly comes from the huge inventory and the expectation of increased supply. As the supply side is further relaxed, PTA processing fees are likely to be further compressed. .
Main risk points
The progress of the epidemic has triggered a sharp decline in downstream demand, which will compress raw material profits upward.
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