Cut Production Is Expected To Attack PTA Strong Debut

PTA production costs are low.

The recent decline in crude oil has led to a deeper decline in the prices of various petrochemical products.

As a direct source of PTA for PX, the price has slipped to $1000 / tonne.

At present, crude oil prices are approaching the US $70 / barrel mark, and the decline is also close to 1/3 since mid June.

Supply easing is another important factor in the early suppression of PX prices.

At present, the domestic PX operating rate has changed little. The average operating rate of China's PX devices is about 78% - 80%, but the PX plant operation rate in other parts of Asia has declined slightly, because the profits of MX - based manufacturers are squeezed.

In September, when China's PX imports historically broke through the 1 million tons mark, the import volume of PX in October has dropped markedly, about 750 thousand tons.

From the profit situation,

and

The price difference has entered the profit and loss line, but the price difference between PX and naphtha has risen to more than 300 US dollars / ton, and there is still room for profit.

At the current PX spot price, the production cost of PTA is about 5500 yuan / ton.

The PTA giant began to cut its production alliance in May, and gradually broke down in September. The PTA plant's comprehensive operating rate increased from 60% of the reduction period to 70% over 10 - November, and the PTA price was more impacted by the increase in supply. The lowest spot price dropped to 5300 yuan / ton, and the 5000 yuan / tonne pass was close.

The new annual contract negotiations are about to begin in December. After the PTA price falls to a low level, the market has stronger anticipation for the PTA supplier's reduction in December. Therefore, as soon as we enter November, the PTA futures market moves significantly.

According to China chemical fiber information network, last weekend and Monday, several PTA suppliers discussed and reached a preliminary joint production reduction plan. The operating rate of a PTA plant will drop to around 50%, and the rest of the participating factories will drop about 20% or shut down a set of devices. If these devices reduce production or stop, the domestic PTA load will be reduced to 60%, which will greatly reduce the spot supply.

However, the background of joint production reduction of PTA enterprises is slightly different from that in mid May. At that time, PTA production loss was relatively large, and the intention to reduce production was relatively strong. At present, PTA production still had a small profit.

The downstream demand is still good.

The arrival of leap September has led to the "post peak season" of the autumn season this year. In addition, with the decline of polyester raw materials, the profit of polyester has been greatly improved, and the stock of polyester stocks has dropped considerably.

Driven by good production and marketing, polyester load has been rising moderately, and is now close to 80%.

With the off-season approaching, polyester load will be affected, but in the short term, polyester stocks are low, business pressure is not high, high operating rate can still maintain for a period of time.

On the whole, the price of crude oil is at a low level. With the promotion of PTA production reduction plan, the two main factors that suppress PTA price in the early stage - cost down and supply easing have gradually weakened.

Under the impetus of the downstream demand and production reduction plan, PTA has chosen to make a breakthrough in the short term.

However, due to the PTA production profit is still available, how far can the PTA market go in the future market, we must see the intensity and implementation of the reduction.