International oil prices rebounded after stabilizing, with polyester chains leading the gains

Overnight international oil prices and the electronic trading on the 9th stabilized and rebounded. Chemical products gained momentum, with polyester chains leading the gains. PTA c…

Overnight international oil prices and the electronic trading on the 9th stabilized and rebounded. Chemical products gained momentum, with polyester chains leading the gains. PTA closed at 5,682 yuan, down 3.35%. Ethylene glycol and staple fiber rose by 3.07% and 3.26% respectively.

Overnight international oil prices did not care about the EIA’s higher-than-expected accumulation of storage. After oil prices continued to plummet, they entered the oversold repair stage in the short term. The US Deputy Secretary of the Treasury said that some Russian oil price ceiling rules will be introduced in the next few days. In addition, the Iran nuclear agreement is not progressing smoothly.

The overall supply and demand of PX, the direct upstream raw material of PTA, is tight and the price is firm, providing support for the cost of PTA. On the supply side, in September, PTA equipment continued to undergo maintenance and shutdowns to reduce loads, and the daily supply and demand destocking was relatively strong. In the early stage, mainstream PTA suppliers stopped parking due to shortage of raw materials and reduced their load. The basis difference strengthened significantly, and the spot processing difference exceeded 1,000 yuan. This week, with the restart of Fujia PX device, the load of mainstream suppliers picked up, and the PTA tension pattern was eased. The spread weakened and profits were slightly compressed. The current PTA basis is at a historically high level. The futures market is driven by negative macroeconomic policies and the price of far-month contracts continues to be suppressed amid expectations of economic recession.

On the demand side, after the end of downstream power restrictions, orders increased seasonally, and rigid demand and speculative stocking increased. From the end of August to the beginning of September, the performance of polyester production and sales was favorable. Under the mentality of “buying up, not buying down”, some speculative demand was released in the downstream. Orders have improved slightly seasonally on a month-on-month basis, but are still skewed year-on-year. At present, the inventory of finished products at the end of the industrial chain is relatively high, and a slight improvement in orders may ease the inventory pressure.

The supply and demand side of ethylene glycol itself continues to improve, and inventory has been continuously reduced in the past month. The market performance this week is strong. Affected by the typhoon, some shipping schedules were delayed, resulting in a sharp decline in ethylene glycol port inventory, which provided strong support for ethylene glycol; after entering the traditional peak season of the Golden Nine and Silver Ten, the polyester operating rate rebounded to around 84%, making 25% of the factory’s delivery volume Continuous increase. The alleviation of the contradiction between supply and demand, coupled with relatively low valuations, has increased the bullish sentiment on ethylene glycol. With the early short-term replenishment willingness significantly enhanced, the market fluctuated and rose.

In terms of short fiber, production restrictions in Jiangyin continue, but Fujian Jingwei plans to restart the 200,000 tons/year installation. As losses in staple fiber production continue to deepen, companies continue to reduce costs and raise prices, and production profits are expected to recover.


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Author: clsrich