Major Events In Polyester Staple Industry In 2018

1. Hengyi Petrochemical speed up merger and acquisition of polyester fiber

On the evening of January 21st, Hengyi Petrochemical announced a notice on the establishment of a subsidiary by foreign investment. It intends to set up a subsidiary through the subsidiary investment of Zhejiang Hengyi Petrochemical Company Limited, which will be used to merge and integrate related polyester fiber assets. Among them, Heng Yi Limited invested funds with its own capital and Fujian Zheng Qi high fiber Polytron Technologies Inc to invest in the establishment of Fujian Yi Jin Chemical Fiber Co., Ltd. at the same time, Hengyi Petrochemical invested with its own capital and established a wholly owned subsidiary, Suqian Yida New Material Co., Ltd. through registered permanent equity limited. The registered capital is RMB 350 million yuan, accounting for 100% of the registered capital.

In recent years, Hengyi Petrochemical has continued to accelerate the expansion of the scale of industrial integration and constantly accelerate the merger and acquisition of polyester fibers, but in 2018 it first touched on the expansion of polyester staple fiber industry. According to statistics, Hengyi Petrochemical's Hengyi new and high tech own polyester staple fiber production capacity is 250 thousand tons. The acquisition of Suqian Yida (formerly Xiangsheng), Heng Ming (formerly Far East) and Fujian Yi Jin (Yuan Jinxing) group's total polyester short fiber production capacity reached 830 thousand tons, and the group's capacity exceeded the three lane group and became the second largest group enterprise in the industry.

2. prohibition of waste policy leads to the decline of direct spinning polyester staple fiber.

In April 19th, the Ministry of ecology, the Ministry of Commerce, the development and Reform Commission and the General Administration of Customs issued a notice to transfer the waste plastic from industrial waste into the list of prohibited solid waste imported from the "restricted import category of solid waste list", which has been implemented since December 31, 2017.

The year 2018 is the first year of the implementation of the ban policy. It will also make the supply of recycled PET market more intense. In the short term, the direct spinning polyester staple industry will benefit from it. However, the advantages of the banned polyester waste can be digested ahead of time, and the advantages of the direct spinning polyester staple industry can not be maintained.

3. the United States has made anti-dumping damage to China's fine denier PET staple fibers.

In June 28, 2018, the United States International Trade Commission (USITC) made an affirmative termination of industrial damage to fine denier PET staple fibres imported from mainland China, India, Korea and Taiwan in China. It concluded that the products in mainland China, India, Korea and Taiwan in China constituted substantial damage or threat to the domestic industry of the United States.

4. Sino US trade has great influence on polyester staple fiber.

According to the statistics of the China Textile Import and Export Chamber of Commerce, this tax relates to more than 6000 tax numbers, including textiles, textile materials, hats and other textile related products. The 10% tariff product includes all yarns, fabrics / fabrics of various raw materials (cotton, wool, silk, hemp and chemical fiber), as well as industrial textiles and some textile machinery products, involving an annual export volume of US $4 billion to the US.

Polyester staple fiber, one of the main fabrics of cotton spinning, will also be affected in the trade war. The United States is the largest market for polyester staple fiber export in China. Last year, the export volume of polyester staple fiber was 16.63%, and it remained at 10%-20% in recent years. This trade war can not be overlooked for the fragile PET staple industry.

The 5.POY4+2 supply seminar was held in Tongxiang to reach a preliminary production reduction agreement.

With 7-9 month PTA as a result of man-made speculation, breaking through the mark of 9000 yuan / ton, followed by a rapid cooling down, polyester staple fiber also suffer, the price trend is like a roller coaster to stir everyone's nerves. In November, the POY4+2 supply side seminar, headed by Tong Kun, Heng Yi, new Feng Ming and Sheng Hong, was held in Tongxiang. A preliminary agreement was reached at the meeting: Tung Kun reduced production by 1800 tons, new Feng Ming reduced production by 1400 tons, and Sheng Hong reduced output by 400 tons.

6. environmental policy is becoming more and more perfect.

With the improvement of environmental protection policy, the polyester fiber staple factories in Jiangsu will face the rectification of coal to gas in the past 2018-2019 years. When the production cost of one ton of polyester staple fiber will increase by 200 yuan per ton, the production cost of polyester staple will increase in 2019, and this will make the enterprises face greater pressure under the backdrop of gradual supply.

7. direct spinning polyester staple fiber production capacity in 2018 was 7 million 195 thousand tons, an increase of 6.51% over the same period last year.

As of November, the production capacity of domestic direct spinning polyester staple fiber reached 7 million 195 thousand tons in 2018 (including 6 million 375 thousand tons of ordinary polyester staple fiber, 820 thousand tons of hollow and low melting point staple fiber), an increase of 6.51% over the same period last year. Throughout 2018, the new capacity is mainly Hengyi petrochemical, Jiangyin Huaxi, Yizheng chemical fiber, Ningbo Dafa and other enterprises. The recovery capacity is mainly based on Hengyi high tech, Suqian Yida and other enterprises.

In the past five years, direct spinning polyester staple fiber has gradually changed from oversupply to supply and demand balance. However, with the increase of new capacity, there is a surplus supply in the industry again. Since the policy of prohibition against waste was put into operation in 2017, direct spinning spun fibers have replaced some recycled staple fibers, resulting in an expanding demand for the industry and attracting many old capacity and new capacity. Especially in 2018, the capacity of the industry has been released significantly, and the polyester fiber industry is expected to face challenges again in the past 19 years.

8. in the past 5 years, the output of polyester staple fiber and viscose staple fiber increased at an average annual rate of about 7-8%

Cotton, polyester staple fiber and viscose staple fiber are collectively referred to as the three major cotton textile materials. In the past 5 years, the total output of three major cotton textile raw materials in China has increased by an average of about 3% annually. In 2017, cotton production increased by about 970 thousand tons, polyester staple fiber was about 530 thousand tons and viscose staple fiber was about 120 thousand tons. The yield of polyester staple fiber and viscose staple fiber increased by an average of 7-8% annually, and the contribution to the overall cotton textile material increment was prominent. In recent years, the direct spinning polyester staple fiber industry has been constantly upgrading and integrating, eliminating some old production capacity, and being affected by the demand of the "forbidden waste" policy and the downstream consumption structure, and the output growth has been more obvious in the past 2017-2018 years.