PX Tight Supply And Demand Processing Profits Will Be Compressed

In 2014, PX added 1 million 520 thousand tons, the total capacity reached 12 million 700 thousand tons, an increase of 23.4%, the annual output of about 9 million 500 thousand tons, imports of about 9 million 250 thousand tons, exports of about 100 thousand tons, the performance of 18 million 650 thousand tons, import dependence of 49.6%.

The downward trend of cost brought by the fall in crude oil prices has not significantly affected the efficiency of the PX plant. On the contrary, because of the rapid decline in naphtha prices, the naphtha cracking rate of PX- has been maintained at over $350, and the price difference at the end of December has even been more than $390.

This and the whole now.

Supply and demand remain tight.

At present, the PX plant is still profitable in production, with a low willingness to take the initiative to cut production, and the price of naphtha is still weak and prices are rising.

From the later stage

In the early stage of operation, about 2000000 tons of PX plants were put into operation in early 2015. Although there is little effect on the tight balance of domestic PX, the supply side will continue to be relaxed.

Under the expected new capacity, terminal demand is still weak, which will stifle market growth.

The whole PX factory in 2015.

It will continue to be compressed, but it is still expected to remain profitable.

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In the past 5 years, the continuous decline of international cotton prices has made the cotton growers of the world fall to freezing point.

According to Bloomberg survey, the willingness of US cotton growers to plant cotton is significantly lower this year. It is estimated that the US cotton planting area will be reduced to 9 million 730 thousand acres.

According to the findings of the cotton association of China in January this year, 2760 cotton farmers in 310 provinces and cities in the 12 provinces of the mainland and 310 counties in Xinjiang autonomous region, the cotton growers who were prepared to reduce cotton planting area in this year accounted for 59.65%.

Among them, cotton farmers in the the Yellow River River Basin and the Yangtze River Valley are expected to reduce their planting intentions by 42.21% and 41.87% respectively in 2015 because of low cotton prices, low yield and increased labor costs. The planting intention in Xinjiang cotton region will also be reduced by 11.5%, and the average planting intention in the whole country will be reduced by about 25.4%.

It is estimated that the cotton planting area in 2015 will be reduced by 11 million 725 thousand and 600 mu from 59 million 20 thousand mu in 2014 to 47 million 294 thousand and 400 mu, with a drop of 19.87%.

Apart from the sharp decline in cotton planting area and output in China and the United States this year, the cotton planting area in India will also decrease.

According to the February production and demand forecast released by the International Cotton Advisory Committee (ICAC), it is estimated that the global cotton planting area in February will be reduced by about 6%, to 31 million 600 thousand hectares.

If we calculate the global average yield per kilogram of 777 kg / HA in the past 5 years, the world's cotton output will be 24 million 600 thousand tons, down 6% from the same period last year, the lowest level since 2009/2010.

The International Cotton Advisory Committee estimated that global cotton consumption in 2015/2016 was 24 million 700 thousand tons, an increase of 2% over the same period last year.

This will be the first time that cotton consumption has exceeded production in the past 5 years.

Although the gap between supply and demand is only about 100 thousand tons, it is still a drop in the bucket compared with China's huge cotton inventories, but it is expected to end this year's domestic cotton market's continuously rising inventory consumption ratio, and the situation of oversupply is expected to improve.

The domestic cotton market is expected to adopt the policy of first protecting the sale of new cotton and then selling cotton and releasing cotton.

Therefore, under the background of global cotton production reduction, domestic cotton market supply pressure will be reduced.

In the medium to long term, the pattern of oversupply of cotton market will gradually shift, which will help cotton prices rise steadily.

But before the Spring Festival, the cotton price will continue to be consolidated by the downstream demand side.

According to the author's understanding, because of the long holiday approaching, domestic textile enterprises are stepping into the light period before the Spring Festival, and the production rate continues to increase. The overall average operating rate has dropped to below 50%.

In the context of the lack of terminal demand, cotton prices are likely to fall, and sales will continue to shrink. Most manufacturers will choose to close their businesses ten days before the Spring Festival. Therefore, the demand for cotton market remains weak before the recovery.

On the whole, holiday factors will continue to interfere with the cotton market in the short term, and the demand side is difficult to improve significantly. However, the supply and demand situation of the annual overall good trend has laid the foundation for the cotton market.

It is estimated that the cotton price center of the middle term is expected to move upward.

After the Spring Festival, the centralized replenishment of cotton enterprises will promote the rebound of cotton prices to a certain extent.