PTA Adjustment Waiting For Spring Demand Restart

First, from macro view.

The study of commodity market must focus on the globalized market.

From the perspective of global economic composition and trade proportion, the United States and China need to focus their attention.

Personal consumption in the United States has bottomed out in June 2009, and consumption has increased positively in 2010. The growth of its industrial production is also driving the growth of investment.

But in the face of the high unemployment rate, the US government can not easily withdraw the quantitative expansion policy. The low CPI has created conditions for the United States to continue to implement a loose monetary environment.

Obama even said that the danger faced by the United States is deflation, and the United States had to implement quantitative easing policy.

In the later stage, quantitative easing policy will continue.

The initial expansion of US $600 billion validates the "thin water". The Federal Reserve will accumulate a "long flow" in the near future with the slow and stable monetary expansion. The total amount may be quite amazing.

This aggressive monetary policy has depressed the US dollar and brought asset bubbles to emerging markets.

The future of the US dollar depends not only on the Fed.

Considering the adjustment of economic structure, China's credit scale and investment scale are decreasing in recent years, but the investment scale is still over 20%.

Compared with the growth rate of M1 and M2, as well as the demand and regular growth rate, the speed of money movement is accelerating, and the market inflation expectation is bigger.

In the next few months, whether the central bank will continue to raise interest rates is constrained by several factors: how does the domestic CPI go? How can the US interest rate go? It can be said that in the face of the inflow of hot money, the central bank's monetary policy is in a dilemma.

China's rate hike cycle has begun, but has not yet entered the cycle of fast rate hike.

At present, although the growth rate of the global economy is not as optimistic as it may be, it is growing relatively steadily.

The low CPI and the high unemployment rate in the United States have led to the United States having to implement quantitative easing policy. The US low interest rate policy will also maintain, which will further expand the global liquidity.

In this context, the demand for commodities will also increase.

The driving force to drive the demand curve to the right comes from three aspects: first, the growth of the macroeconomic growth leads to the actual (consumption) demand growth; the two is loose monetary policy, which leads to the influx of funds, triggering the growth of speculative demand; three, the inflation expectation leads to an increase in stock (stockpile) investment.

The price increase caused by the right shift of demand curve depends on the supply curve of various industries, which is mainly determined by factors such as capacity utilization, inventory level, raw material supply and so on.

From the "investment clock" theory, the global economy is still in the recovery stage, not overheating.

Commodity prices have not reached the top and are still at the middle stage of the rise.

The central bank's tightening policy is a confirmation of inflation expectations.

Two, after the Spring Festival, the supply and demand side of PTA is tight.

Cotton prices remain high, inflation expectations and speculative capital speculation have pushed up the PTA price in the early stage. In the face of apparently high production profits, the whole industry has a high operating rate, but in fact, the PTA surplus capacity has not changed completely.

In the first half of this year, domestic polyester production capacity was 27 million 360 thousand tons, and domestic PTA capacity was 15 million 560 thousand tons.

Since the beginning of the year, the average monthly import volume of PTA in China is 600 thousand tons. Over the past six months, the domestic polyester 80% operation rate and the PTA capacity 90% start rate have calculated that China's PTA is over 200 thousand tons per month.

Due to excess liquidity in China, the surplus 200 thousand tons of PTA can easily be pformed into stocks of polyester enterprises, trading enterprises and exchange delivery warehouses.

Conversely, when the market is not optimistic, this part of the stock will be released, thereby increasing the supply pressure of the market.

From the perspective of PTA industry chain, in 2011, the overcapacity of PTA will be improved.

According to the current production capacity plan, the domestic polyester production capacity is expected to reach 5 million 300 thousand tons in 2011, and the demand for new PTA will be about 4 million 500 thousand tons. In the same period, PTA will add 4 million 400 thousand tons of production capacity, which is basically matched with the new demand brought by the increase in polyester production capacity.

However, in 2011, there is a dislocation between the new opening device and the PTA new opening device. The new polyester device is mainly launched in the first half of the year, but the PTA new device is mainly launched in the second half of the year. The dislocation of the production schedule will make the supply and demand of PTA tight in the first half of the year and the second half of the second half of the year.

In addition, it is estimated that PX capacity will increase by 1 million 800 thousand tons in 2011, which is difficult to meet the demand of PTA's new capacity. The gap between supply and demand will reach about 1 million 100 thousand tons, and the supply of PX will tend to be tight in the second half of 2011.

If we only look at the two months before the Spring Festival next year, the PTA supply and demand will be eased to a certain extent. The end of the seasonal demand season and the return of speculative capital will cause the excitement of the PTA market to dissipate.

Judging from past data, the production activities of polyester and cloth are seasonally changing. Almost every year there are two production peaks: one is the two month after the Chinese Lunar New Year (3-5 months), the other is the peak production season in autumn (9-12 months).

The peak period of production of polyester and polyester fibers is slightly ahead of cloth.

Generally speaking, textile fabrics, which meet the peak demand, will have a certain effect on the price of PTA. The reason is that the downstream needs to be stocked in advance to make the terminal demand upward.

Therefore, the PTA demand has the same seasonal change as the demand for textile and clothing. From December to January, it is the time when PTA demand is weak.

Three. Spread trading opportunities and Trend Investment Opportunities

1. spread trading opportunities

As mentioned earlier, during the current period before the Spring Festival, the demand for PTA was weaker compared to the earlier period of excitement, but for the same period of crude oil and fuel oil market, the situation was just the opposite.

The price of oil has obviously increased since the beginning of November. As the temperature gradually decreases, the demand for heating oil will gradually appear.

Therefore, only for the supply and demand of the industry, the price of crude oil and fuel oil will remain more than before February next year.

Price is the direct embodiment of basic supply and demand, and the price difference is a direct reflection of the fundamental strength of each species. In terms of PTA and fuel oil, due to the homogeneity of production and the cyclical difference of demand, the focus of attention of the TA and FU market and the market atmosphere will change. The price difference between the two will tend to shrink, which will create the opportunity for PTA and fuel oil in the near future.

In order to more accurately understand the relationship between TA index and FU index price, we carried out cointegration analysis and descriptive statistics analysis for the 697 sets of TA index and FU index.

After examination, the long-term equilibrium relationship between TA and FU price can not be unrestricted.

When the futures price deviates from the normal range, arbitrage opportunities will also arise, which makes arbitrage between the two varieties possible.

Taking into account the cointegration relationship between the TA index and the FU index, as well as the 1 hand PTA for 5 tons and the 1 hand fuel oil for 10 tons, we recommend that investors build a price difference portfolio of "throwing 4 hands TA to buy 3 hand fuel oil", and use the difference between 2TA and 3FU to decide whether to stop earnings or stop losses, and the two normal spreads interval is 1500-4000 points.

2. Trend Investment Opportunities

Different from the weak trend before the Spring Festival, PTA will usher in the demand season again after the Spring Festival next year. In addition, due to the large number of newly opened devices in the first half of the year and the increased number of new PTA devices, this may also lead to a strong price in the first half of the year. If the liquidity surplus in the first half of the year is still difficult to effectively curb, the market still has strong inflation expectations and does not exclude the high price of PTA. However, in the second half of 2011, the price of PTA will fall to a certain extent, as the new PTA device is gradually put into operation, and the continuous increase in interest rates and changes in the macro situation, the US dollar trend or the inflation expectation of the central bank will be suppressed.