In the supply and demand game, PTA may operate with slight fluctuations

From the beginning of February to the present, the PTA spot market in East China is in a volatile and downward stage, and the market continues to decline. The spot market price in …

From the beginning of February to the present, the PTA spot market in East China is in a volatile and downward stage, and the market continues to decline. The spot market price in East China fell from 5,740 yuan/ton on February 1 to 5,485 yuan/ton in the middle of the month, and the overall market price fell by 255 yuan/ton. A decrease of -4.44%.

From a cost perspective, during this period, although OPEC+ decided to maintain the policy of cutting production by 2 million barrels per day, Federal Reserve officials continued to raise interest rates, EIA crude oil and refined oil continued to accumulate across the board, and the market weighed the impact of CPI data and the U.S. government will continue to raise interest rates. The release of 26 million barrels of crude oil from the Strategic Petroleum Reserve has continued to put pressure on oil prices and hinder its upward potential. However, driven by optimism about the recovery of Chinese demand, and supported by positive factors such as Saudi Arabia raising the price of oil sold to Asia and Russia’s production cuts on the supply side, European and American crude oil futures maintained a volatile negotiation trend from the beginning to the middle of the month, which still provided a boost to the chemical market. From the perspective of raw material PX, from early February to mid-month, Weilian Chemical’s 1 million ton unit restarted around February 19, Guangdong Refining’s new 2.6 million ton unit began production, and Hainan’s 1 million ton unit restarted on February 16 It has begun to heat up and recover. The overall increase in supply is expected to make the upward drive of raw material PX insufficient. The Asian market price has fallen slightly, which has not provided strong support to the PTA market. However, the PTA spot market price has dropped significantly, causing the PTA processing fee to fall from around 270 yuan/ton to 100 yuan. It is at a low level near Yuan/ton. ,

From the perspective of PTA’s own supply, short-term PTA construction starts fluctuated from 71.63% at the beginning of the month to around 71.91% in the middle of the month, and the supply continues to remain sufficient. During this period, the Sanfangxiang device has not been restarted after unexpected maintenance; the load of Yisheng New Materials’ 7.2 million-ton device first dropped to 70% and then increased to around 90%; the load of Yadong Petrochemical’s 750,000-ton device first increased to 90% and then dropped to 80% After the 1.25 million-ton production line of Weilian Chemical was put into operation, the overall load increased to around 70%; Zhuhai BP1#110 and 2#1.25 million-ton units reduced the load to 80% around February 15th; the overall PTA load is within a narrow range Adjustment, the supply is still increasing, and it is not very beneficial to the market price. Although affected by the lower processing fee, the load is expected to decline, but it is still not implemented in the short term.

From the perspective of downstream demand, the start-up of polyester increased from 72.36% to around 77.53% from early February to mid-month, and the demand for PTA continued to increase. However, the situation of new orders for terminal textiles at home and abroad is less than expected, and the new orders for domestic trade in spring and summer are expected to be issued near the end of the month or the beginning of next month, so the enthusiasm of textile companies for short-term production is weak. It is reported that a small number of spring and summer sample orders have been issued one after another, but the profits are meager and companies are not willing to accept orders. As the operating rate of weaving manufacturers increases, the actual market shipments are average. Negative feedback transmission still affects upstream market sentiment.

Taken together, support from the cost side still exists from the beginning to the middle of the month, but the supply and demand side of PTA itself is weak, and the accumulation of inventory is large, which once caused the negative supply and demand to exceed the boost from the cost side. Therefore, the spot price of PTA fluctuated and fell during the period. From the perspective of the market outlook, the cost-end crude oil is running warmly, the raw material PX is generally supported, and PTA is oversupplied in the short term. It is expected that the PTA market will fluctuate slightly in the second half of the month, with limited downside space. In the future, we still need to pay attention to cost-side fluctuations, PTA supply and whether end-use textile demand improves.

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Author: clsrich