Downstream Production And Sales Rebounded, How Can PTA Be Interpreted?

At present, the PTA installation is at a high level, with ample supply and inventory accumulation, and the market sentiment is affected by the macro environment.

However, recently, the downstream polyester production and marketing improved, PTA has changed its declining trend, and the market price has risen. The market is highly doubtful about the rebound.

At this stage, how will the PTA market be interpreted?

Upstream performance is relatively optimistic.

At present, the price of CFR China PX is US $870 / ton, which has dropped by US $130 / ton in just 1 months.

With the advent of the era of big refining and petrochemical, PTA manufacturers with strong voice have stepped up the construction of PX devices.

All along, from PX to PTA to polyester industry profits are mostly concentrated in the PX side, the first heavy pattern in 2019 was affected by PX production capacity to change.

From the perspective of price differentials, the current price difference between PX and naphtha is at a low level of $300 / ton, and it is hard to fall deeply.

At the same time, in the early stage of the PX installation, the financial cost is high, and the enterprise obviously does not want the price of PX to fall too fast.

Therefore, the upper reaches continue to give way to limited space, and PX is unlikely to fall further.

High operating rate

As of last week, the average operating rate of PTA was 86.4%, up 1.6 percentage points from the previous period.

In terms of installations, Sichuan can invest in chemical PTA plant commissioning, shutdown of Shanghai Petrochemical 400 thousand tons, and 900 thousand tons PTA of Peng Wei Petrochemical Company, and PTA manufacturer's inventory is about 4 days.

Downstream high demand or difficult to sustain

At present, the market mentality is still cautious. By the end of May, there will be about 40 days of terminal billet storage.

The loom start load is reduced to about 75%. If the fabric is not stored smoothly, the loom load will continue to decline.

After the phased replenishment of the terminal plant, it takes time to digest the polyester stocks, and the market lacks continuous good support to support the high production and marketing of polyester. It is speculated that the production and sale of polyester products will go back to the doldrums in the end of May to the beginning of June.

The market mentality is cautious, and the sustainability of high production and marketing of polyester is generally not optimistic.

Overall, the terminal demand is not good. Polyester enterprises need more time for profit recovery. They are pmitted to the PTA disk, showing a lack of action on price. Although the production and sales of downstream polyester products have picked up, they are expected to be in a short-lived trend or PTA.