Recently, it was reported that due to the good diesel efficiency of a factory in East China, the PX device with a production capacity of 9 million tons/year plans to reduce the load plan to 75%-80% in the near future, which triggered a rapid rebound of PTA: the main 01 contract recorded the highest 5416 yuan/ton, up more than 5% during the day.
However, downstream polyester factories, mainly filament yarns, have seen an increase in load reductions this week. Polyester start-up loads have declined, and PTA upstream and downstream loads have dropped. The industrial game has intensified. Where will the market outlook go?
Cost support: PX’s fallback atmosphere is temporarily suspended
There is no doubt that the previous weakening of crude oil has brought direct bad news to the crude oil system, and it is also the core factor of the early decline in the chemical industry. However, after the market’s panicked decline was contained, the quotations of related products stabilized again.
As of November 3, PX quotations remained unchanged for three consecutive days at 8,600 yuan/ton. Although this value has dropped significantly from the 9,300 yuan/ton in mid-October, the re-stabilization of the price has indeed played a role in “stopping the decline” to a large extent. Judging from the current data, the Meiya arbitrage window has opened again, and although the PX-MX spread has rebounded, it still cannot reach the device start-up profit. It is difficult for existing devices to have a significant recovery in start-up load. In the short term, the PX-naphtha spread may stabilize. pick up.
At the same time, the price of PX CFR in China closed at US$988/ton, an increase of US$14/ton from the previous trading day.
Also strengthening simultaneously with PX is PTA spot. Recently, there has been an increase in maintenance of PTA equipment. Hengli has maintained 2.2 million tons of equipment, Yisheng New Materials has reduced load on its 3.6 million tons unit, Yizheng Chemical Fiber has maintained 350,000 tons of equipment, Yisheng Ningbo has restored 2.2 million tons, and Zhongtai has restored 1.2 million tons. Currently, PTA is on. The load dropped to 73.04%.
In terms of PTA processing fees, in September, PTA factories were subject to tight PX, and the operating load dropped significantly. The tight spot supply of PTA supported the price increase much higher than the cost. PTA processing fees rose sharply. As Shenghong Refining PX produced qualified products Expectations for PX to be put into production have increased, PTA pre-maintenance equipment has been restarted, and due to the negative feedback of sluggish terminal demand during the peak season, PTA processing fees have declined. With the recent overhaul of multiple PTA devices, processing fees may stabilize and rise.
On November 4, the spot price of PTA in East China increased by 28 yuan/ton, and the reference for negotiation was around 5,610 yuan/ton.
Weak supply and demand: The market is highly cautious about rebounding
Cost support has brought strength to the market, but based on fundamental data, the market still has doubts about the height of this rebound.
The traditional “Golden Nine and Silver Ten” peak season, but this year’s peak season is not busy, and the demand for Silver Ten is completely lower than expected. In terms of domestic demand, this year’s Double Eleven orders are coming to an end, and the e-commerce drive of Double Eleven is not obvious. The overall transaction volume is not as good as the same period last year. Most of the transactions are small orders, and large orders are missing. The main reasons are that the epidemic in the textile wholesale market has caused difficulties for weaving companies to deliver goods, Double Eleven orders have entered the final stage and have entered a seasonal weakening period, there are concerns about further declines in textile raw materials, and the expected decline in cold winter.
From the perspective of weaving, the comprehensive operating rate of chemical fiber weaving in Jiangsu and Zhejiang regions was 61.33% on October 27, a decrease of 0.47% from last week. The overall atmosphere in the textile market is not good. Although orders for cold-proof and warm fabrics are acceptable in the early stage, the overall volume is limited and it is difficult to comprehensively improve the weakening trend of the market. The current gap in new orders is obvious, and under the influence of the short-term stoppage of textile business districts in some regions, weaving factories are considering cutting production in advance or taking holidays in advance in November. The current order volume is far less than the same period in previous years, and the market is overall weak.
The weak terminal directly limits the purchase of filament. It is understood that the current industry’s weaving production is accelerating the decline, and the enthusiasm for stocking raw materials is generally low. Polyester filament production and sales are still weak, and the average production and sales estimate of sample companies in Jiangsu and Zhejiang is below 50%. Of course, the high pressure on polyester filament production and sales has also increased expectations for polyester production cuts. However, the surge in polyester raw materials may in the short term drive a “buy up, not buy down” sentiment downstream, helping polyester factories to effectively destock.
In the short term, due to multiple impacts such as costs, PTA construction starts remain at a relatively neutral and low level, and spot prices maintain a high premium structure. However, there is no obvious reduction in supply and demand. As the end of the year approaches, the pattern of weak supply and demand is expected to be relatively weak. obvious. As short funds left the market, it triggered a rebound in the market. But from a fundamental perspective, there is a lack of obvious upward drive, and we are waiting for the rebound to end.