PTA Upper Limit Of Supply Capability Is More Definite.

At present, supply is still the key factor leading to the price trend of crude oil. On the one hand, the future of OPEC countries is facing the dilemma of who gives out the interests.

We believe that the possibility of a substantial reduction in crude oil is relatively small. In the future, crude oil in the OPEC countries is still the main source of supply pressure.

On the other hand, since July, the output of crude oil in the United States has been gradually reduced, and the supply of crude oil in non OPEC countries has generally had a positive impact on oil prices.

But we need to pay attention to the fact that oil production in North America needs oil prices to stay low for a long time, so a sharp rise in short-term oil prices will likely lead to a rebound in crude output.

At present, the supply side will continue to lead the trend of crude oil prices.

The supply side is also highly related to the operating range of crude oil prices. Crude oil prices will rise to over $60 per barrel, and will gradually be suppressed by rising expectations of output supply. Crude oil prices will fall below 45 US dollars / barrel, and will face greater output reductions.

From this we believe that crude oil prices will remain low in the medium term, which will generally affect the downstream PTA cost side.

In the near future, the market has revealed that the company may restructure, and it may not be able to produce PTA again during the year. The two sets of new devices that were originally planned for the four quarter will be postponed to next year.

At the same time, the PTA social inventory in the two quarter and the three quarter continued to decline, and now it has dropped to a low level near 1 million 600 thousand tons, making the upper limit of the actual PTA supply capacity in the mid term relatively definite.

In the past, profits and

There is a significant negative correlation, but the negative correlation may be weakened at the present time when the upper limit of actual supply capability is more definite.

At this stage,

The effect of the reduction of production may be better. The driving strategy of PTA leading enterprises to reduce production and improve profits will be more sufficient.

Judging from the actual market situation in the near future, in November Yisheng Dalian 3 million 750 thousand tons PTA plant, East China and Southern China about 1000000 tons of PTA installations have overhaul plan.

Therefore, under the current situation that the actual PTA supply capacity of China is more determined, the overall operating rate of PTA will be maintained at or below 65%.

Even though the operation of PTA enterprises has improved significantly, PTA enterprises are above the profit and loss balance line, but we believe that the operating rate will no longer be significantly improved.

In the PX link, there were more PX overhaul plans in Asia in October.

In the future, the pressure of supply and demand of PX has increased, and the degree of excess of PX has been further deepened. Therefore, the gross profit of mid PX links has narrowed gradually.

At the same time, the spread of naphtha and crude oil is now expanding to near $100 per ton, which is at a better level.

We believe that the PX price in the medium term is not large and downward, and there may be an oscillatory trend, that is, the PTA cost side will be less changeable in the future.

In the future, the gross profit margins of PTA enterprises will be limited, and there will be larger imaginary space for them. This will mainly depend on the operation strategy of PTA enterprises.

On the whole, the impact of upstream crude oil and PX on PTA is relatively neutral. The downward trend of PTA price will be relatively limited, and the space of upward fluctuation is relatively large, so it is more appropriate to make PTA more callbacks.