Two Years Later, The PTA Market Share Will Increase To 68%.

The expansion of chemical fiber predators will never stop, especially in PTA.

PTA and MEG are the main raw materials for the production of polyester filament, accounting for about 85% of the production cost of PET filament.

The production of 1 tons of polyester filament requires roughly 0.855 tons of PTA and 0.335 tons of MEG.

Over the years, in building PTA, the predators are not the most capricious, only more capricious.

Dongsheng Hong: 2 million 400 thousand ton project will be built, and PTA capacity will increase to 3 million 900 thousand tons.

In May 24th, Jiangsu Honggang Petrochemical Co., Ltd. (hereinafter referred to as "Honggang petrochemical"), a wholly owned subsidiary of Jiangsu Oriental Rainbow Limited by Share Ltd, will invest in 2 million 400 thousand tons / year PTA expansion project. The total investment of the project is estimated at 3 billion 858 million yuan in May 24th.

At present, the PTA capacity of Honggang Petrochemical is 1 million 500 thousand tons / year.

The implementation of the new project is to further consolidate the advantages of PTA capacity scale, enhance the comprehensive competitiveness of the polyester industrial fiber industry chain, and enhance the continuous profitability of listed companies.

The project will be built in the Lianyungang petrochemical industrial base of Xuwei New District, Lianyungang, Jiangsu province. The utility and auxiliary facilities of the plant should rely on the existing facilities as far as possible, and the construction period of the project will be two years.

After the project is put into production on time, Dongsheng Hong's PTA capacity will reach 3 million 900 thousand tons.

Yisheng Petrochemical: the annual output of 13 million 500 thousand tons of PTA is called "Big Mac".

As we all know, Yisheng Petrochemical Co invested by Hengyi and Rongsheng has PTA capacity up to 13 million 500 thousand tons.

In 2018, the revenue of Rongsheng petrochemical PTA was 22 billion 143 million 500 thousand yuan, accounting for 24.22% of the company's total revenue, and PTA's revenue grew by 15.35% compared to the same period last year, with gross profit margin of 7.47%.

Rongsheng Petrochemical said in its 2018 annual report that before 2015, the domestic PTA expanded rapidly, and the rapidly increasing supply could not be digested by the weak demand in the downstream. The average load of the industry began to decrease, and the price of products fell, thereby reducing the profitability of PTA enterprises.

Before 2009, China's PTA production facilities were mainly concentrated in Jiangsu and Zhejiang provinces.

Beginning in 2015, with Yisheng and Hengli's large-scale operation in the Liaoning market, Liaoning's capacity rose to the top of the whole country.

Last year, with the commissioning of the two phase of Jiaxing Petrochemical Company, the PTA capacity of Zhejiang area retook the status of "boss".

Rongsheng Petrochemical is one of the leading enterprises in the PTA industry. From north to south, along the coastline, the strategic layout of Liaoning Dalian, Zhejiang Ningbo and Hainan Yangpu 3 big PTA bases, holding and share PTA production capacity totalling about 13 million 500 thousand tons, the largest in the world.

Rongsheng Petrochemical also said that after entering the 2015, the clearance rate of domestic PTA backward production capacity was significantly accelerated, and downstream demand increased, and supply and demand relations gradually resumed balance.

Yisheng petrochemical as one of the leading enterprises in the PTA industry, the processing cost is relatively low, the upstream and downstream pricing power is strong, and the PTA gross profit margin has been improved.

Hengli Petrochemical: PTA annual output of 6 million 600 thousand tons, will soon reach 11 million 600 thousand tons.

Hengli Group is located in Dalian Changxing Island Industrial Park Hengli Petrochemical currently has an annual output of 6 million 600 thousand tons of PTA capacity, is the world's largest single production capacity of PTA production base.

Xiaobian can see in the industrial park, beneath the dozens of meters deep blue crane, neatly placed numerous large white bags, which contain PTA products destined for the whole country and around the world.

At present, Hengli Petrochemical's PTA expansion project is accelerating construction.

It is estimated that the PTA capacity of Hengli Petrochemical Company will increase to 11 million 600 thousand tons after the expansion project is put into operation.

Tong Kun shares: PTA basically self produced, self marketing, industrial chain synergy obvious

The Jiaxing Petrochemical Company of Tong Kun shares has successfully completed its one or two phase project, forming a capacity of 4 million tons ~500 million tons (actual capacity) in PTA.

Tong Kun shares said in its annual report 2018, the company's Jiaxing Petrochemical phase 1 million 200 thousand annual output PTA project and the two phase of Jiaxing Petrochemical phase two project completed and put into operation in late 2017, so that the company reached PTA, down to spinning and adding bombs, and formed a production and marketing pattern of PTA- polyester spinning and weaving technology, on the one hand, enhanced the overall strength of the enterprise. On the other hand, most of the raw material PTA of the company was purchased from wholly owned subsidiary of Jiaxing petrochemical, with short distance, low cost and stable supply. Compared with other PTA purchased polyester filament enterprises, the company has a stronger cost advantage.

New Feng Ming: an annual production of 2 million 200 thousand tons of PTA project is expected to be put into operation in the three quarter.

The new Dushan PTA phase 2 million 200 thousand annual output is expected to be put into operation in the three quarter of 2019.

2018 annual report data show that in 2018, the amount of PTA purchased by new Feng Ming was 2 million 711 thousand and 600 tons.

Fujian 100 Hong: in construction 2 million 500 thousand tons annual PTA project

Fujian Bai Hong Petrochemical Company Limited will build an annual output of 2 million 500 thousand tons PTA project, the project is located in Quangang, Fujian, Quanzhou Petrochemical Industrial Zone Nanshan area.

The project adopts the PTA production technology of INVISTA patent. The main project of the project builds 1 sets of PTA production equipment with an annual output of 2 million 500 thousand tons, with a total investment of 5 billion 723 million yuan.

The highest price difference reached 3300 yuan / ton!

Chemical fiber tap opens a new round of expansion

In recent years, after undergoing a major shuffle, the PTA industry has optimized its capacity structure, greatly reduced its inventory, and improved the industry's boom and profitability.

PTA oligopoly has come into being. Mainstream suppliers will be able to stop at oversupply / low processing fees, which will affect the supply structure to a certain extent, thereby continuing to make profits.

In 2018, the highest price difference between PTA and raw materials reached 3300 yuan / ton.

The huge money making effect has accelerated the process of new capacity production. It is understood that since 2018, many leading chemical fiber enterprises such as Dongsheng Hong, Tong Kun and new Feng Ming have announced the announcement of PTA investment and construction project.

At the same time, for the big guys, in order to flatten the price fluctuations, and let raw materials not be controlled by others, it is inevitable to choose the upstream PTA production and develop towards the omni-directional leader.

Up to now, China's nominal capacity of PTA is 51 million 880 thousand tons, and its effective capacity is 45 million 330 thousand tons.

In 2019, the new capacity of PTA was mainly concentrated in leading enterprises.

PTA new capacity statistics

Data source: public data sorting

2020~2021 will usher in the peak of PTA production in China in the year of 2020~2021, and it is expected to total 14 million 400 thousand tons / year, accounting for about 29% of capacity at the end of the year.

2019-2021 years of PTA production projects planned in China (10000 tons)

Data source: public data sorting

Overall, the supply and demand structure of PTA in 2019 depends on the operation of Fuxing and demand growth.

In 2020~2021, PTA may face a new round of expansion, and the pressure of oversupply will increase.

Worried that the new capacity will lead to reshuffle, the industry will return to the low profit stage of the arms race and slaughter.

Because 19 years later, there are a lot of new expansion plans, and the main concern for the supply side is that the new capacity will lead to reshuffle, and the industry will return to the low profit stage of the arms race and slaughter.

Stock production capacity resumption: over the past two years, the industry has continued to recover, excluding some of the old production capacity which has been suspended for a long time.

It includes 900 thousand tons of, which was resumed in 17 years in February, and 1 million 400 thousand tons of Hua Bin and 3 million tons of Hai Fu Chuang (Yuan Xianglu) produced by the end of 17, and third sets of 1 million 500 thousand tons of Hai Fu Chuang earlier this year.

At present, only 1 million tons of Sichuan Shengda chemistry have been built.

The new investment and construction capacity: the total volume of PTA projects to be expanded in the future is about 29 million tons, which seems to be huge. However, many projects are still in the planning stage, and only advance to the stage of signing the cooperation agreement.

At present, the capacity to start construction under construction is only 4 million 400 thousand tons of new Feng Ming Dushan port (first phase Q4 production in 2019, two commissioning in 2020 Q4), Hengli four phase 2 million 500 thousand tons and Xinjiang Zhongtai chemical 1 million 200 thousand tons, and the Sino Thai Chemical 1 million 200 thousand ton plant is a group of 4 million tons of oil and coal refining integrated services, supporting the 1 million 500 thousand tons of polyester, so as to realize the industrial upgrading of the Sino Thai textile plate from cotton spinning to blending.

The slow progress, but also the high certainty capacity, has 2 million 500 thousand hundred tons in Fujian, five tons in Hengli 2 million 500 thousand tons and two tons in Honghong Petrochemical Company in the two phase.

In addition to the above devices, there are still about 14 million tons of planning capacity, but with high uncertainty, such as Ningbo Taiwan and Jialong two, etc., it has been planned for several years to start construction, or the production time is relatively late, such as Zhongjin Petrochemical Company, Tong Kun Yangshan Port and so on, basically after 21 years.

On the whole, it is estimated that the supply side will add about 4 million 700 thousand tons of PTA this year, and it will basically be concentrated in the four quarter. The first half of next year will also be a vacuum period.

Two years later, the PTA market share of the six giants will rise to 68%.

Although the PTA is the lowest ROE center in the whole polyester chain, PTA is the middle link of the industrial chain, and the polyester under PX, whether it is for refinery or polyester, is a competitive place, and naturally has a strong integration property.

According to the calculation, considering the cost savings of the sales terminal and the reduction of energy consumption caused by utility matching, the cost savings of the industrial chain integration will be saved at 100-150 yuan / ton, which will be reduced by 20% compared to the current PTA minimum tonnage cost.

It is the cost competitive advantage brought by the complete industry chain that makes the giants even throw money into the industry even if they are not profitable, and the supply side is hard to restrain.

Accordingly, we expect that in the next three to five years there will be several million tons of large PX-PTA- polyester base, and the industry will usher in a new round of shuffling.

According to the current plan, the PTA industry will usher in a new round of capacity release peak from the second half of next year. Due to the serious mismatch between supply and demand, it is expected that the industry will usher in a new round of fierce price war.

At that time, small and old devices will be eliminated first, while the leading industry chain giants will achieve expansion. It is estimated that the PTA market share of the six giants will increase from 54% to 68% in 2021.