PTA Prices Should Be Kept Below The Cost Price For A Long Time.

The bottom of the price of PTA has basically been formed, and even if it goes down further, the fall process will not last for a long time.

At the same time, taking into account that there is no sufficient upward momentum at this stage, the price of PTA will oscillate around the 5000 yuan / ton line.

PTA's capacity is mainly concentrated in the three giants.

Among them, Yisheng petrochemical production capacity is 13 million 400 thousand tons, Hengli petrochemical production capacity is 6 million 600 thousand tons, and Xiang Lu petrochemical production capacity is 6 million 150 thousand tons.

At present, the total capacity of PTA is roughly 46 million 550 thousand tons, and the capacity of 3 million 200 thousand tons of Far East Petrochemical is removed, which amounts to 43 million 350 thousand tons of capacity.

When the concentration of CR4 of an industry is more than 40%, the industry can be defined as an oligopoly industry.

At present, the industry concentration of the top three enterprises in PTA is CR3= (1340+660+615) /4335 * 100%=60.32%.

In the environment of excess capacity, the reduction of output by oligopoly enterprises is often not the rise of product prices, but rather the market share of other enterprises is occupied by other enterprises.

In order to get more

We will adopt a way to reduce prices. Other enterprises will only be passive and drop prices for their own market share.

With the price cut.

The development of oligopoly enterprises is bound to "lose both sides".

At this time, there will be conspiracy among oligarchs, because enterprises realize that they are willing to reach agreement on price competition at a higher level instead of competing fiercely with each other.

In this way, each enterprise can get their own economic benefits at a stable high price level, thereby avoiding losses caused by price competition.

Although conspiracy in oligopoly is widespread, the conspiracy of oligarchs is fragile.

At a reasonable location, some enterprises will have the idea of resuming production.

In view of this reason, the limited production and insurance price of PTA enterprises can not change the weakness of PTA prices, only can achieve the role of PTA price rebound, it is difficult to make PTA prices rise for a long time and substantially.

So far, the price of PTA has continued for four and a half years.

There are many reasons for the fall in the price of PTA.

First, from 2009 to 2010, the price of PTA was skyrocketing, and the profits of PTA production enterprises were huge. Under the drive of interests, a large number of PTA capacity was approved. However, due to the release of capacity stampede, PTA production capacity increased significantly, and supply volume soared.

Second, the domestic economic growth slowed down, the foreign economy was also weak, the growth of domestic and foreign demand slowed down, and the growth rate of chemical fiber industry was far lower than that of capacity growth.

Third, in the second half of 2014, international crude oil prices were cut down, and PTA cost collapsed.

Fourthly, the state restores and stores as a direct subsidy, and cotton prices gradually move closer to cotton. The fall in cotton prices has led to a fall in the price of PTA alternatives.

These four factors superimposed, resulting in PTA price from 12000 yuan / ton to the lowest 4450 yuan / ton.