One Word: High Price Of Cotton Hoisting PTA'S "Niu Tou" Will Maintain High Oscillation.

Because

PTA spot was pushed up by PX, expanding the price gap between inside and outside market.

PTA as a chemical product, its production cost is closely related to the PX of petrochemical products.

The correlation between PX and PTA has been gradually strengthened since last year, from 0.80 in the first half of last year to 0.94 in the second half, and 0.96 in the second half to January this year.

There is no doubt that the rise in PTA since December last year, especially in January this year, is mainly driven by the rise of PX.

As of January 24th, the price of PX rose by US $255, or up to 18.5%, mainly because the expansion of PX capacity could not match the expansion of PTA capacity, and the supply of PX would be tight or long-term.

At the same time, PTA spot rose 1200 yuan since January, or 12%.

The cost of production converted from PX is 9700 yuan / ton. Because of the smooth pmission of PX PTA price, PTA still maintains more than 1000 yuan of production profit.

Similarly, the PTA spot price on the outside market was also promoted by PX this month, rising by US $255, or more than 18%.

As the external market PTA rose more than the internal market, the difference between the import price and the internal price of the foreign exchange price expanded from 124 yuan at the beginning of the month to 666 yuan / ton on the 24 day.

The substantial increase in the spot market relative to the spot market will play a certain role in the PTA internal market trend.

In addition, the contract settlement price of domestic major manufacturers in January was 10750 yuan / ton, 1150 yuan / ton higher than the settlement price in December last year, and some manufacturers may quote 11000 yuan / ton in February.

Higher contract settlement price in January and February contract offer good support for PTA later stage trend.

PTA's textile raw material properties will be stimulated or the market trend will be dominated by cotton.

PTA is used as textile raw material, and its 75% is used to produce polyester fiber. Its price is also affected by cotton price.

The guiding effect of cotton on the price of PTA is mainly achieved by affecting the short and short price changes, because when the cotton price is high, polyester and short can play a part in the substitution of cotton.

At present, the price difference between cotton and polyester is 13955 yuan / ton, and the cotton and polyester ratio is 1.98, which is still at a historical high. Therefore, cotton trend still plays an important role in polyester and short.

Historical data show that when cotton prices are low, PTA and cotton prices are almost irrelevant, for example, in the first half of last year, cotton prices were relatively low. The correlation between PTA and cotton index was -0.42, while in the latter half of the year, as cotton became stronger, the cotton and polyester short spreads widened, and their correlation coefficients increased to 0.94.

For example, in January 21st, PTA futures opened a 2% lower price in the case of a sharp drop in crude oil overnight and a slight adjustment in PX. However, because of the US cotton trading limit, Zheng cotton was going higher and higher, and PTA in the market also followed strong steps, and TA1105 dropped from 2% to nearly 1%.

Recently, the supply of ICE and China's cotton futures has increased rapidly, thanks to the shortage of supply in China and the United States, and 24 days hit a new high of 150 years.

After the Spring Festival, as the spinning mills and weaving factories start to start, the textile raw material properties of PTA will be further stimulated, and the trend of cotton will have a greater impact on the trend of PTA.

In summary, the expansion of raw material PX and the spread of PTA's internal and external price differentials will form a certain support and pull for PTA.

The PTA market will be driven by PX to cotton, or will lead PTA to a new level.

But by the end of the year, PTA will be further underpowered and will maintain a high level of oscillation.