Theoretically, rising costs will be gradually transmitted downward through the industrial chain, thereby ensuring profits in all links. However, in the case of poor demand, the market price of end products may fall into the difficult dilemma of “price but no market”. In order to ensure smooth sales, end consumer merchants are bound to tend to stabilize prices or sell at reduced prices to ensure income from end sales; Secondly, for the textile industry, the proportion of raw materials in terminal sales is less than 20%. The rising cost of raw materials is difficult to smoothly transmit to terminal clothing and textile sales. Therefore, the production of intermediate products must bear high costs. Compared with the downstream textile industry, the profits of the chemical fiber industry chain in the middle have dropped more sharply and bear more pressure from the cost side. According to statistics, the PTA industry suffered losses most of the time in the first half of 2022.
In order to alleviate the pressure of losses, PTA’s capacity utilization rate fell from a relatively high level in July, falling by 10.57 percentage points from the beginning to the end of the month. Since late July, PTA’s unplanned maintenance and production reductions have gradually increased, and the capacity utilization rate has further declined, to 65.67 %.
But even if PTA maintenance increases, the load of the entire industry chain will decrease even more! From March to April, the operating rate of the polyester and downstream textile industries dropped significantly. It has improved since May, but is still at a relatively low level in history.
If domestic sales are not possible, please come and join us! PTA companies are keen on exporting
From January to July 2022, the PTA processing fee was around 415 yuan/ton, and the entire industry was in a state of production loss. Domestic sales cannot be opened, production capacity is excess, and processing fees have dropped below the level of industry production losses. What should PTA companies do?
PTA Enterprise seems to have found a new way! Enterprises urgently need to export PTA to earn a certain amount of profits, and maintaining a trading method based on processing with imported materials is the most effective way.
PTA export volume in June was 393,000 tons, the second highest level in history. PTA export volume from January to June was 2.06 million tons, a year-on-year increase of 54%. PTA export volume in the first half of the year was 515,000 tons lower than last year. In the first half of the year, my country’s PTA export situation was relatively optimistic, with the average monthly export volume above 340,000 tons, which is at a historically high level. Exporters who are mainly major PTA suppliers are highly competitive. In the first half of the year, the PTA export volume of the top two PTA suppliers accounted for 42% of my country’s total export volume.
Since 2021, the PTA supply gap in India and other countries has expanded, while my country’s large-scale new devices have been put into production one after another. The cost competitiveness of the main domestic PTA suppliers is strong. Against the background of the mismatch between foreign PTA supply and demand, my country’s PTA companies are actively increasing PTA Export amount. Domestic PTA companies mostly export by processing with imported materials. Export PTA is quoted in the form of “PX cost + US dollar processing fee”. For example, the quotation for exported PTA with imported materials is “0.66*PX cost + 120 to 130 US dollars/ton.” “Processing fee”. With the blessing of new technology, the PX dosage ratio of the new PTA device is slightly lower than 0.66 and the cost processing fee is far less than 120 US dollars/ton. The trading method of feed processing not only avoids the risk of raw material price fluctuations but also has a greater risk. It has realized the cost advantage of the new PTA device to a great extent and given full play to the advantages of the new PTA device. Domestic PTA companies are keen on exporting, which is the main reason why PTA export volume has repeatedly hit new highs.
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