As of May 25, the spot price of PTA in May fell by 10.30% month-on-month. The author predicts that PTA will show an oversupply pattern in June, and the spot price is expected to be weak and oscillating.
From the supply side, at the end of May, Shandong’s 2.5 million tons/year and Zhejiang’s 2.2 million tons/year PTA plants plan to restart. In June, Guangdong still plans to launch 2.5 million tons/year new PTA production capacity. It is necessary to pay attention to whether the surrounding 1.5 million tons/year new PX production capacity will be put into operation in mid-June. If the PX project is successfully put into operation, it is estimated that the new PTA production capacity will be It will be put into production in late June. The supply of PTA is relatively sufficient. According to the currently announced maintenance and production reduction plans, the monthly PTA output in June is estimated to be more than 5.3 million tons, which may reach a record high. Therefore, the oversupply of PTA has led to downward pressure on the spot market.
From the demand side, as most polyester products began to turn a profit throughout May, polyester factories will have the motivation to maintain a relatively high operating load in June under the background that the cash flow of polyester products has been restored. In addition, it is estimated that there will be little pressure on the inventory of finished polyester products in June. Although under the high load of polyester, polyester products are expected to accumulate inventory in a narrow range in June, but it is completely within the tolerable range. According to the current polyester production situation, polyester production in June will be around 5.2 million tons, and the theoretical PTA consumption in the non-polyester field is about 190,000 tons. The total PTA consumption in June is estimated to be 4.63 million tons, which is still at the Historically high levels. In addition, as some polyester products turn losses into profits, polyester factories’ purchasing intention for spot PTA will increase in June, and some downstream polyester factories will not only use long-term PTA supply to maintain production.
From a cost perspective, from 2021 to 2023, international oil prices fell below US$70/barrel several times, but rebounded without exception. The author predicts that the main international crude oil price range will remain at 70-80 US dollars per barrel in June, and the market is in a game state between the risk of U.S. debt and the support of major oil-producing countries. At present, there is no result in the U.S. debt negotiations, which still brings great uncertainty to the crude oil market. However, it can also be seen that the production cuts by major oil-producing countries have a strong support for crude oil.
In terms of PX, the impact of the peak sales season of gasoline in the United States on my country’s PX market has been released, and domestic PX devices that were routinely inspected in the early stage will resume production one after another. It is planned to restart five sets of PX devices with a total capacity of 4.7 million tons/year from the end of May to the beginning of June, and a new PX device with a capacity of 1.5 million tons/year may be put into operation in mid-June. Against the background that domestically produced PX will increase, it is estimated that the PX market may fall in June, and the support for PTA from the cost side will weaken.
In June, market expectations also need to pay attention to the seller’s intention of PTA: whether the main PTA supplier announces unplanned maintenance of large-scale PTA equipment and once again purchases PTA spot goods from the market in large quantities; whether the delivery of another main PTA supplier is slow again; whether the main PTA supplier Are traders purchasing PTA spot goods with a high basis again? The author believes that the seller’s intention may temporarily reduce the supply of PTA circulating goods and drive some traders to collectively hesitate to sell, which will support the PTA market and basis.
Overall, PTA will show an oversupply pattern in June, and supply factors may dominate the PTA market. While crude oil oscillates within a narrow range and PX prices may fall, the support for PTA from the cost side is not strong. However, the seller’s intention is an uncertain factor, and the PTA spot market is expected to be weak and oscillating in June.