6-7 Month PTA Trend Sharp Rise And Fall Late Downward Trend Is Difficult To Change

Part of the equipment resumed production, supply increased, demand decreased due to limited orders, supply and demand contradictions intensified again, and PTA prices descended to find new balance.

The price of PTA rose sharply in 6-7 months, and the main 1909 contract rose from 5082 yuan / ton to 6612 yuan / ton, but after that, it fell sharply.

Supply continues to increase

At the end of June and early July, PTA prices rose sharply, and processing fees increased, reaching a maximum of 2500 yuan / ton, the highest point in many years.

Under such circumstances, the enthusiasm of PTA production enterprises is rising, and the installation of Fuhai company and Luoyang Petrochemical Company, which has been pre shutdown, has been resumed at the end of July. The overall load of PTA devices will continue to rise and market supply pressure will increase. Moreover, Sichuan's capacity to invest 1 million tons / year has been successfully tested at the end of May. However, the inventory of production enterprises is low, and the average stock 1-1.5 days, to a certain extent, ease the pressure of supply side.

At present, the processing cost of PTA is 1300 yuan / ton, and the production profit of the company is 600-700 yuan / ton, although it has dropped sharply compared with the previous high point, but it has not returned to normal level, and the enthusiasm for production is still high. Without major changes in costs, PTA needs to use price downwards to compress profits in order to cope with oversupply. In particular, the main 1909 contract is close to delivery, while positions and warehouse receipts are still increasing.

Poor demand performance

Influenced by Sino US economic and trade frictions, the end textile enterprises are cautious in production this year, mostly by orders. Polyester, due to poor production and marketing, coupled with the impact of printing and dyeing inspection by annulus, polyester enterprises have entered the storehouse stage. As of July 25th, the POY of polyester filament stocks was 8 days, 7 days higher than the previous low point, an increase of 700%; the FDY stock of polyester filament was 13.5 days, 9.5 days higher than the previous low point, and 237.5% increased; the polyester filament DTY inventory was 22 days, 10 days higher than the previous low point, increasing by 83.33%.

The enthusiasm of polyester enterprises has declined, and the strategy of stock elimination has begun. Such as new Feng Ming and other enterprises to expand production intensity, Yizheng chemical fiber began to cut production, and other enterprises such as the new material postponed the restart time. Under such circumstances, the start-up load of polyester enterprises has dropped slightly in recent years, resulting in a decline in demand for PTA. Not only that, because of the recent PTA prices continue to fall, the market is not enough to buy gas, enterprises that are to buy, further reduce the demand for PTA.

Forecast for future market

Due to the good profits in the early stage, the large scale production of the production enterprises and the shrinking of terminal demand, the problem of over supply of PTA has intensified. Although the price of PTA has dropped sharply in recent years, the price of PTA will continue to be bottled up until stimulating production enterprises to reduce production and increase procurement by terminals. On the operation, short space is advisable. We should wait patiently for many opportunities.