New Year High In PTA:2018, 2019, Short Supply And Increased Profits

2018 is the year when PTA is in the annals of history. The PTA spot rose to a high level of 7 and a half years. PTA's annual theoretical profit reached a new high in 7 years. PTA futures contracts for single day contracts reached a record high, PTA exports reached a record high and imports reached a 4 year high.

The PTA spot market monopoly property strengthens, the futures market introduces the overseas investor.

In the 34 working days that began in July 18, 2018, PTA spot rose 3320 yuan / ton (+56%) to 9300 yuan / ton, which is 7 years and a half high.

The PTA factory has strong industry monopoly attributes, PTA large factories are rising and downstream rigid demand is better, PTA market has appeared a textbook case of violent increase.

The frenzied speculation has attracted the frenzied market entry of futures funds. In August 16, 2018, the PTA main futures TA1901 turnover was more than 669 million hands, and futures volume reached a single day single contract historical high. The average annual turnover of PTA futures in the 2013-2018 years was between 59-179 hands, of which the average daily turnover in 2018 was only about 1 million 20 thousand hands.

In 2016, the new capacity of PTA in -2018 was only 2 million 200 thousand tons / year, while the downstream polyester expansion capacity was 8 million 200 thousand tons / year. In 2018, the supply and demand of PTA were roughly balanced. In 2018, the output of PTA theory was about 39 million 440 thousand tons, and the theoretical demand was about 38 million 640 thousand tons.

In 2018, China's PTA export volume theory will reach a record high of about 860 thousand tons, and the PTA import volume theory will be about 770 thousand tons, or nearly 4 years.

The main oil producing countries cut production, oil prices are still volatile, and the global economic situation is not optimistic. The Sino US trade war is persistent and the downward pressure on China's economy is bigger. It will restrain the oil price inflation. It is estimated that the main shock of WTI oil in 2019 is between 50-65 US dollars / barrel.

In 2019, the new capacity of PTA will be put into operation at the end of 2019, so the actual output of the new capacity will be limited. The restart of third sets of 1 million 500 thousand tons / year PTA plant will increase PTA production in real terms.

According to the 80% start-up load, according to Hengli Petrochemical 2 million 500 thousand ton / year installation start 2-3 months, Fuhai 1 million 500 thousand tons / year plant start up 11 months, JOYOU information estimated that the new PTA output in 2019 is about 150-160 tons / year.

In 2019, the new polyester production capacity was about 4 million 80 thousand tons per year.

According to the 86.5% average annual commencement of polyester in 2018, the demand for new PTA in 2019 is about 3 million 30 thousand tons.

In 2019, PTA theory was in short supply, and JOYOU information believed that the market price of PTA was strong.

In the 1 quarter of 2019, the 1 million 600 thousand tons / year PX plant of Fuhai was restarted. In the 2 quarter, the 4 million 500 thousand ton / year PX plant of Hengli refining company will be commercialized. In the 3 quarter, the 1 phase 4 million ton / year PX plant of Zhejiang Petrochemical Company and the 600 thousand ton / year PX installation of Hainan refinery may be put into operation, and domestic PX will increase significantly.

JOYOU information predicts that PX's theoretical production profits will narrow sharply in 2019, and PX will not be able to maintain high profits as in 2018, while the profit of industrial chain will shift to PTA.

In 2019, the downward pressure on China's economy was relatively large. The Sino US trade war is in the state of being on the side. The poor macroeconomic environment may affect the export of terminal textile and garment products, and indirectly demand the PTA market.

JOYOU believes that China will continue to reduce taxes and expand domestic demand to stimulate the development of the real economy. The reform plan of value added tax may be introduced during the two sessions in 2019, and there are more uncertainties in 2019.