PTA Fundamentals Will Continue To Weaken In The Late Stage To Seize The Opportunity To Meet Each Other.

According to the current average operating rate of polyester plant 90%, the existing PTA capacity has been relatively surplus. In the late PTA productivity growth background, the industry overcapacity phenomenon will become increasingly evident.

In the four quarter, with the coming of PTA's new production capacity approaching, oversupply of industry is expected to be strengthened, and market bullish confidence will be suppressed. Although there are many plans for overhaul during the year, the intensity of supply side reduction is relatively limited. At the same time, the downstream market performance is not good enough to effectively pull the market demand. Therefore, the price of PTA in the future market is weak.

Increased supply is expected to increase.

In 2019, the PTA industry came to the peak of its production. The four quarter plan of the new Feng Ming (603225, stock bar) and Hengli Petrochemical (600346, stock bar) installations were the focus of the market. The two devices originally planned to be put into operation in October and are postponed to November and December respectively. After the National Day holiday, Hengli Petrochemical started to turn over two PTA production lines. In addition, there were overhaul schemes in 10 to November, including Han Bang petrochemical, Ya Dong petrochemical and Honggang petrochemical. According to the 15 day maintenance cycle, the output loss caused by the overhaul during the year is about 500 thousand tons, which still can not completely offset the increment of the new capacity released during the year.

According to the current average operating rate of polyester plant 90%, the existing PTA capacity has been relatively surplus. In the late PTA productivity growth background, overcapacity will become increasingly evident. However, in the short term, due to the delay in new capacity and the centralized maintenance of many devices, the PTA price has been slightly boosted, but there is little room on the top.

Cost support is no longer supported.

The fourth quarter of 2018 is the best profit for PX industry. With the release of domestic refinery facilities, PX's new capacity has been put on the market, and PX profits have sharply reduced in 2019. In the three quarter of this year, the average PX processing fee was only 331 US dollars / ton, down 245 US dollars / ton compared with the fourth quarter of last year. Earlier, under the background of Saudi oil field attack, chemical products prices rose, while PX prices were relatively weak, showing the weakness of PX supply and demand. 9 in the middle of the month, the PX- naphtha oil price difference dropped to below US $300 / ton, less than half of the beginning of the year. Taking into account the future output of PX's new capacity remains to be large, the PX- naphtha oil price difference will remain low.

Recently, the PTA spot processing fee has dropped to a low level of 800 yuan per ton, while the PX price has been hovering near the US $800 / ton, which has weakened the supporting role of PTA price. PX is unable to support the PTA market when it comes to the peak of production.

Downstream demand lacks traction power

During the National Day holiday, the stock market of polyester market has been rising due to the holiday of some weaving factories. After the festival, polyester POY stocks are mostly in the vicinity of 7 to 12 days. FDY stocks are mostly around 10 to 15 days. DTY stocks are mostly around 20 to 25 days, and are generally higher than before. In the past two days, the replenishment of many factories has increased the production and sales of polyester products, but the mainstream production and sales of filaments are still only about 70%. Polyester factories are still in the storehouse cycle.

After the holiday, polyester factories failed to perform well, and some cash flow of polyester products had fallen into losses. According to the relevant data, from 1 to September, a total of 2 million 900 thousand tons of new production capacity of polyester were added to the domestic market. Although the new capacity plan of about 2000000 tons was released in the later stage, with the decline of polyester profit, the delay probability of new capacity production was very large. At present, the terminal orders are not optimistic, and the price of polyester is suppressed.

Later PTA fundamentals will continue to weaken. In the background of new production capacity has not yet been put into operation and some manufacturers are overhauling, the short-term PTA price has been lifted slightly, so that we can seize the opportunity of meeting high.