From The Inventory Perspective, What Will Be The Polyester Market After The Holiday?

At the beginning of the year, the focus of the market was concentrated on polyester terminals again. This year, affected by the bottom up of crude oil prices, the terminal of PTA industry chain carried out a round of centralized replenishment under the condition of relatively low raw materials.

At the same time, the overall performance of terminal demand is fairly good. Polyester production profit has declined, inventory is relatively low, and pressure has eased significantly earlier.

But what we need to pay attention to is that during the long Spring Festival, there will be a seasonal decline in demand, and the weaving of the terminal has begun to gradually reduce load. What will happen to the polyester market after that year?

Pet factory inventory decline before the holiday

Since January, the international oil price has continued to rebound, giving the market stop signal. Most of the downstream polyester prices are at the lowest level since 2018, and the profit of polyester products is very small. Despite the fact that the market has a clear judgement of consumption in 2019, because weaving factories have the habit of stocking before the Spring Festival, and in 2018, the business efficiency is relatively good, the funds are relatively abundant, and the stocking capacity is strong. Therefore, since the beginning of January, the sales of polyester factories have improved significantly, and their stocks have continued to decline.

By the middle of January, the stock of short and short stocks was basically cleared, and the stock of filament enterprises was mostly at a low level. By the end of January, most of the weaving mills began to take off. Raw materials had been stocked at the normal level of 20 to 30 days, and even raw materials had been stocked on 45 days.

At present, the substantial decline in the stock of polyester factories is one of the main advantages of the market. The possible impact is that the implementation of the maintenance plan is not as good as expected during the Spring Festival, and the consumption of raw materials PTA exceeds expectations.

Post holiday inventory will be at a high level.

Before the Spring Festival, the result of the large scale storage of polyester factories may be that the maintenance during the Spring Festival is not as good as expected. After the Spring Festival, the stock of the products returned to a high level. However, after a large number of stockings before the Spring Festival, the expected stock of raw materials is expected after the Spring Festival, so the enthusiasm for stocking will be limited.

Therefore, before the Spring Festival, the weaving mill is stocking or producing ahead of time. It can only be said that the stock has been transferred from the polyester plant to the weaving factory, and from the polyester to the grey cloth, but it has not really entered the consumer link, so it is much overdrawn before the Spring Festival.

For the future consumption, the macro level research is not optimistic, mainly because the high leverage restricts the consumption ability of the residents, so the industrial chain after the spring festival may face the pressure of high inventory.

How does the library affect geometry?

Since the beginning of this year, besides the filament POY floating on the cost line, other varieties have a good profit margin. Under the relatively abundant fund background, the repair time of polyester plant has been delayed, prompting the rebound of PTA market.

From the perspective of the industry chain, the biggest hidden danger in the future market is the heavy storage of the polyester market after the Spring Festival. However, with the improvement of polyester production and marketing in recent years, polyester stocks have dropped rapidly from the high level since the second half of 2017. In just two months, the stocks of polyester filament POY, FDY and DTY dropped to 3, 4 and 8 days respectively, representing half of the inventory level in the same period last year.

From this point of view, even if the polyester factory is stored in the late stage, the lower inventory level will also prolong the storage period, thus weakening the negative impact of the increase in polyester stocks after the Spring Festival.

Generally speaking, the inventory level is high. Polyester factories will first adopt the means of price promotion to reduce inventory. If prices are still poor or losses are long after the price reduction, they may choose to reduce production or overhaul them.

According to the current trend, upstream raw materials have good support for the polyester market. The state of high inventory in the downstream is decided by the production and marketing of polyester market and the storage period.