What's The "Mysterious Force" Behind PTA's Self - Appointment

Yesterday PTA reproduced the extreme market. In the afternoon, the PTA1909 contract dived straight. At the end of the closing period, 324 thousand shares were closed to the limit. At night, the market declined more than before. After opening, it started to go lower and lower. Finally, it closed at 5572 yuan / ton with a 3.83% decline.

What is the "mysterious force" that drives PTA down? Insiders said that the PTA fundamentals were still running weak. Yesterday's limit did not have a clear incentive. Only the unconfirmed rumors and empty decisions were circulated on the market.

Extreme market reappearance

Looking back on the recent trend of PTA, it is easy to switch mode to let market participants keep feeling: PTA, it is not easy to say "love you".

Recently, the PTA news is constantly hyped up and the games are intensified. Before the 2 time, the mainstream suppliers of PTA had reduced the supply of contract goods, and were later dismissed. In the afternoon of July 18th, the PTA price was stimulated by the news, and it increased sharply. In July 19th, the 209 thousand stocks dropped sharply. PTA1907 delivery of goods into the market, spot liquidity surged.

Yesterday, the mainstream factory took the initiative to lock the goods on the disk. As of July 22nd, the 1909 main contract of PTA was substantially increased, with 324 thousand hands closed at the limit. Back to fundamentals, there are signs of weakness in the near future.

However, the news that the mainstream factories were actively sending goods on disk had not been confirmed. "During this period, the PTA main contract fluctuated considerably, but in fact, it was more affected by the news. But the news is hard to control, especially the unofficial news. It is difficult to judge the truth or false in a short time. We should pay more attention to fundamentals and trends. Judging from yesterday's market outlook, a sharp increase in the volume of downlinks must be a concentrated effort. Cao Qing, analyst at Bank of China International Futures, said that from a fundamental point of view, in fact, the recent PTA situation is intertwined, but the downstream demand has not been improved. This has some negative impact on market confidence.

Decline in polyester operating rate

As a matter of fact, the PTA mainstream factory has strong willingness to ship through the terminal. Since the beginning of July, polyester products began to lose money, and polyester losses gradually increased in late July. At present, PET bottles, PET chips and polyester FDY are all at a loss, which also leads to a further decline in the polyester operating rate of the lower reaches. Downstream polyester end profit, low production and marketing, resulting in the accumulation of PTA stocks, market participants said that in this case, the big factory to find opportunities to sell goods, or choose to hedge in the 09 disk, or sell the goods, if insist on a very high price will fall into a passive situation. "Although the price of a large factory today is down, it has suppressed the spot market, but the price dive is not related to this, but a wave of funds to take the initiative to suppress." The market participants said.

It is understood that since July, downstream polyester is basically in the storehouse stage. "Since the end of June and early July, the stock of the filament has reached a very low level, and the stock has been rising. This is mainly due to the weakness of production and marketing, and the terminal demand has not kept up. In terms of polyester, inventory has dropped substantially before, and in fact, it is not a real demand improvement, but just a shift in inventory. This has led to the fact that the weaving mill has been digesting the inventory in the early stage, and the production and marketing of polyester products in July is relatively weak. At present, I think the polyester stock is basically back to normal level. Cao Qing said, at present, the biggest problem is that the inventory of terminal grey cloth is too high. In fact, the final market depends on whether the terminal demand can really improve.

Market participants expect that polyester load will continue to decline in the future. "Because polyester plant is still in production cycle, and there are polyester factories to sell raw materials, resulting in the overall weakening of the spot. In addition, when the 1907 contract entered the delivery session, the liquidity of the spot eased somewhat, and the underlying basis oscillation declined, but the buying atmosphere did not improve significantly, and the current price was dragged down. Terminal orders were not good, and the load of Jiangsu and Zhejiang looms dropped 3 percentage points to 72% over the previous week. Polyester cash flow continues to be compressed, polyester factory production further expanded, last week polyester load fell 2.3 percentage points to 86.1%. Next week, new Feng Ming, Yizheng chemical fiber and other devices exist production and maintenance plan, it is expected that polyester load will continue to decline. Wei Lin, chief energy futures analyst, said.

Continuous fermentation

In terms of demand, the size of pet end production has increased again. The supply of multiple PTA devices is scheduled to resume at the end of the month. As a whole, PTA will become more relaxed in the future. According to Wei Lin, Luoyang Petrochemical 325 thousand ton plan will be resumed in mid 7. Fuhai set up a 4 million 500 thousand ton PTA plant plan to restart in July 30th. Hengli 2 million 200 thousand tons plan to overhaul 15 days in the near future. Yizheng chemical fiber 350 thousand ton plant maintenance plan was postponed from mid 7 to August 15th, and planned maintenance for 40 days. Taiwan Ya Dong 1 million 500 thousand tons plan from September 13th onwards for 17 to 20 days. Last week, the domestic PTA load remained stable 89.6%. With the device restarting in the late stage, the PTA load will gradually increase.

"To sum up, the PX device near the end of the month has a restart plan, and the Sinochem run PX new plant plans to produce qualified products at the end of the month, coupled with the oscillation of the international oil price interval, and the cost support has weakened. On the supply side, Luoyang petrochemical and Fuhai innovation device plan was restarted at the end of the month, and the delivery of goods was inflow. The liquidity of the stock market eased somewhat earlier than before, and the PTA basis weakened. Downstream and terminal orders are not good, polyester factories cut production further expanded, Jiangsu and Zhejiang loom load and polyester load consistent decline. Under the background of weakening PTA fundamentals, we should maintain the midline selling short view. Wei Lin said.

In Guotai Junan Futures analyst Ye Weile, the recent PTA1909 volatility has increased. Overall, there has been no change in fundamentals. The price fluctuates around PTA's low inventory and weak demand for polyester. "Last Friday, there was no sign of continuous improvement in polyester production and marketing. It is expected that the PTA processing fee will be oscillating. Later PTA will re-enter the rhythm of the library. " He said.

The founder's futures research group pointed out that the scale of polyester production has increased again in the near future. Unless the PTA price center of gravity moves down in the short term, polyester products will continue to suffer losses. Polyester production will be expanded or further expanded, so that the price of raw material PTA will further decline.