More Than 10 Billion In Hainan Yangpu And Zhejiang Ningbo Built 8 Million 500 Thousand Tons Of PTA Projects, Hengyi What Card?

Recently, the Hainan free trade pilot area construction project (the Seventh Batch) Yangpu centralized signing ceremony was held in Yangpu Yingbin Hotel and Shi Bi hall. Vice governor Shen Danyang of Hainan attended the signing ceremony and delivered speeches. Zhou Junping, Secretary of Yangpu Working Committee, delivered a speech. The director of the CMC committee chaired Ren Qinghua.

Hainan Yisheng PTA two phase project as one of the seven major projects, formally signed to Yangpu, Hengyi Group Chairman Qiu Jianlin attended the signing ceremony, and spoke as a representative of the contracted enterprises. Song Xiaojun, general manager of Hainan Yisheng Petrochemical Co., Ltd. signed a contract with the Management Committee of Yangpu Economic Development Zone as a representative.

Before the ceremony, Shen Danyang met Qiu Jianlin and conveyed the concern and attention of the Hainan provincial government to entrepreneurs and projects. The two sides discussed in depth the development of Hainan, the operation of enterprises, the actual situation of Yangpu Development Zone, and reached consensus in many aspects.

In his speech, Qiu Jianlin first introduced the basic situation of Yisheng, Hainan, and frankly said that she had the honor to witness and participate in the construction of Hainan and Yangpu, and thanked the Hainan provincial Party committee, the provincial government and the administrative committee of the development zone for their support.

It is reported that Hainan Yisheng PTA two phase total investment of 4 billion 500 million yuan, will build an annual output of 2 million 500 thousand tons of PTA production equipment, 500 thousand tons of PET production facilities, as well as supporting terminal expansion and utility projects. The project will adopt advanced PTA production technology with independent intellectual property rights, adopt advanced manufacturing technology and automation and intelligent production equipment in the industry, invest and build in the scope of the existing project base, and carry out technological upgrading and upgrading. After the completion of the two phase of the normal operation, the single line capacity, material consumption and energy consumption are all in the leading position in the world. In the five years, the total output value will be increased by about 70 billion yuan and the total tax amount will be about 2 billion yuan, creating a total of 300 jobs directly. The four major groups will focus on local graduates, laid-off reemployment, retired soldiers and poor workers.

Qiu Jianlin said that Heng Yi will never forget his mind and keep his mission in mind. He will push forward the project construction with "high starting point, high standards and high demands". He will repay the trust and love of all sectors of society with first-class performance, and make new and greater contributions to building Yangpu into the leading area, demonstration zone of Hainan free trade port and the growth pole of Hainan's high quality development.

According to public information, Hengyi Petrochemical Co., Ltd. has 42.5% shares of Zhejiang Yisheng Petrochemical Co., Ltd. through Hengheng Petrochemical Co., Ltd. in Hainan. The registered capital of Hainan Yisheng is 3 billion 580 million yuan. The company's business scope is the production and sale of purified terephthalic acid. The capacity of PTA is 2 million tons / year and the capacity of supporting bottle flakes is 1 million 500 thousand tons / year.

This reporter learned that, according to statistics from relevant research institutes, a number of large PTA production lines in China have been overloaded in 10-11 months, and the PTA social circulation inventory has dropped from the highest point of 1 million 420 thousand tons in September to about 120 (-22) tons at present. The problem of high inventory in the PTA industry needs to be solved. New Feng Ming Dushan energy phase 2 million 200 thousand tons / year PTA project was formally put into operation in October 31, 2019, marking the opening of the new round of PTA production peak.

For the PTA giant's motivation to expand significantly, Liu Jun, a Northeast Securities analyst, said recently that its core reason is that PTA can invest in new projects at lower cost, and expand its share through low cost in line with its interests. For the PTA leader (Yisheng and Hengli), the previous PTA capacity construction made public works, storage tanks, land and so on without additional investment, which made the cost of investment in the expansion of the leading company lower. For example, Hengli PTA#4 and #5 scale are 2 million 500 thousand tons / year, less than 3 billion yuan investment, Yisheng added 6 million tons of PTA total investment is expected to be 6 billion 731 million yuan, while Dushan energy 2 million 200 thousand tons / year PTA investment reached 4 billion yuan; Fujian 2 million 500 thousand Hong Kong / 2 million 500 thousand PTA / EIA total investment reached 5 billion 700 million yuan. Of course, there is another reason why everyone is cliche. Putting into production is a deterrent to potential competitors.

The first textile network reporter noted that, in view of the future capacity of PTA, Hengyi Petrochemical Related executives revealed in late October this year, first of all, PTA capacity growth can not copy the past high growth rate, because the PTA production base increased, the same capacity growth rate of growth is relatively low, and the growth rate can be completely digested by downstream demand. Secondly, the continuous improvement of PTA productivity concentration is conducive to the healthy development of the industry, and has a good guarantee for the reasonable profit of the PTA. Once again, the competition in the polyester industry is now a competition in the all round and whole industry chain, not just focusing on PTA single products. When PTA's profit is narrowed, the price spreads in other sectors of the industrial chain will expand when demand is stable. Finally, the polyester industry has maintained a relatively stable growth rate in recent years, and the downstream demand has weakened the capacity of the new PTA for the digestion of PTA, and the future Sino US trade war mitigation and economic stabilization will also support the demand growth of the industrial chain.

The above Hengyi Petrochemical executives admitted that in the future, the release of new capacity, PTA profits may have a central decline, but there is still a reasonable profit, and no longer repeat the past expansion of the industry caused a substantial loss. 　

In Liu Jun's opinion, PTA can expand the market share and earn money, but it can't control the price and earn the price because it can't control the quantity of others. On the one hand, PTA, on the one hand, is deterring the potential competitors by announcing new capacity, and grabbing the future demand increment. By controlling the progress of deliverability release, it maintains the whole industry not too bad, but the nature of the industry determines that the faucet can only control "quantity" and not control "price" under the situation of oversupply. The industrial chain extension of polyester tap and the change of other capacity will always make the industry structure in a "relaxed" state. In this situation, PTA can only earn excess returns from scale advantage. Therefore, Liu Jun believes that although the concentration of PTA industry is getting higher and higher, the final net profit of the leading company may be 100 yuan (determined according to the rate of return on investment), which may be a continuous deficit for the whole industry.

Liu Jun introduced that Yisheng's PTA plant was mainly distributed in three locations: Yisheng, Zhejiang of Ningbo, Yisheng of Dalian and Yisheng Hainan of Hainan, with a total capacity of 13 million 500 thousand tons / year, accounting for 30% of the total capacity of the country, and three cases of Yisheng PTA factory are as follows:

1) Zhejiang Yisheng PTA has an actual capacity of 5 million 500 thousand tons / year, with 4 PTA production lines.

2) Yanda Shanda PTA actual production capacity of 6 million tons / year, has 2 PTA production lines, a 2 million 250 thousand ton / year (commissioning in 2009), a 3 million 750 thousand ton / year (2012 commissioning, 2014 expansion from 3 million tons to 3 million 750 thousand tons).

3) Hainan Yisheng PTA has a capacity of 2 million tons / year (put into operation in 2012).

Observation, Yi Sheng three main production capacity in 2011-2013 years before and after commissioning, but the profit difference is bigger. 浙江逸盛、逸盛大化、海南逸盛三家PTA工廠主要產(chǎn)能幾乎都在2011-2013年前后投產(chǎn)，盡管投產(chǎn)時間類似、產(chǎn)能規(guī)模類似、采用的技術工藝路線也較為一致，但三家盈利能力差異較大——從規(guī)模上看，浙江逸盛與逸盛大化接近，但盈利能力明顯強于逸盛大化、這主要是由于運費成本的節(jié)省：的原材料上，浙江逸盛的PX部分直接采自鎮(zhèn)海石化、2015年后，寧波中金石化PX投產(chǎn)，在PX的運輸費用上大為節(jié)省；PTA產(chǎn)品可直接通過貨運發(fā)往江浙長絲企業(yè)，而逸盛大化的運距相對遠一些；此外，由于因為地理位臵的限制，海南逸盛和大連逸盛會有保持一定的庫存水平，因此公司的業(yè)績更大的受到庫存的影響：2014/2015年，受原油暴跌的影響，產(chǎn)品價格大幅下滑，庫存損失嚴重拖累了業(yè)績，而2018年受益于整體PTA價格抬升，逸盛大化與海南逸盛業(yè)績增長的幅度、量都大幅超過浙江逸盛。

In September 19th, Yisheng also announced that it would build another 6 million tons PTA project, which will be implemented in two phases.

Project Name: Zhejiang Yisheng New Material Co., Ltd. annual output of 6 million tons PTA project

The main body of the project: Zhejiang Yisheng New Material Co., Ltd. (Hengyi limited and Sinopec 50%).

Project location: Ningbo Petrochemical Economic and Technological Development Zone, Zhejiang

Contents of the project construction: the project is located in the Ningbo Petrochemical Economic and Technological Development Zone, with a planned area of about 362.6 mu. The company adopts its own technology, and intends to build new rainwater detection pools, substations, reclaimed water reuse facilities, sewage treatment facilities and other supporting facilities. It also makes full use of the utility facilities built in the park to build 2 sets of PTA production, forming 6 million tons / year production capacity.

Project investment: the total investment of the project is RMB 6 billion 731 million yuan.

Yisheng new material investment is more economical. It is expected that the first phase will be put into operation in 2021. Compared with the previous three Yisheng, the advantage of the new Yisheng new material lies in:

1), with PX of Sinopec and CICC, a good industrial chain is formed, the supply of raw materials is guaranteed, and the transportation cost is further reduced.

2), the project is built in the Ningbo Petrochemical Economic and Technological Development Zone, the overall scale advantage is further enhanced, and the operation and management cost of the device is lower.

3) tons of investment is more economical (only 1 thousand and 20 yuan / ton), and near the polyester terminal demand market, the overall competitive advantage is still outstanding.

Liu Jun said that most of PTA is used on polyester, and according to consumption size, polyester is divided into polyester filament, polyester staple fiber, polyester chip and polyester bottle piece. In the final analysis, PTA needs to see domestic demand and external demand of polyester.

From the point of view of output, polyester production reached 36 million 961 thousand and 800 tons in 1-9 months in 2019, an increase of 8.40% over the same period last year. According to the products, the production of polyester filament / staple / bottle piece reached 2593.9/459.98/642.3 million tons, an increase of 5.13%, 19.30% and 15.44% compared to the same period last year. The growth rate of polyester staple fiber and bottle piece obviously increased the demand of the whole polyester. The reasons behind the polyester staple fiber are more capacity expansion, logic of increasing profit and decreasing profit, and the growth of bottle piece production is the substitution logic of prohibition of import of waste bottles, but this logic basically tends to end. The situation of increasing profit and decreasing load and decreasing load in June also confirms this point. The increase in output in the first half of this year is not related to the uplink of crude oil prices. With the increase of production, the gross profit of polyester staple fiber and bottle flake is decreasing and stock is accumulating, so the actual support is even weaker than that seen by simple data.

From the export perspective, in 2019 1-9, China's Polyester exports reached 5 million 124 thousand and 900 tons, an increase of 12.10% over the same period last year. According to the products, the export volume of polyester filament / staple / bottle / slice reached 202.78/75.82/233.88/43.21 million tons, an increase of 16.29%, -4.69%, 15.09% and 46.03% compared to the same period last year. The export growth rate of filament and bottle piece has reached over 15%, which constitutes the main promoter of export growth.

From the inventory point of view, 1-6 months, whether it is polyester filament, or staple fiber, bottle piece appeared tired warehouse, but after May, filament enterprises entered into the active inventory stage, showing that the load decreased voluntarily, the stock fell and the gross profit picked up; the polyester staple fiber showed a sign of active replenishment because of the profit, which showed that the starting load continued to rise and inventory rebounded.

On the whole, Liu Jun believes that polyester consumption may increase by 6-6.5% in 2020 and after the main reason is that polyester filament enterprises enter the active inventory stage, indicating a further slowdown in demand. The growth rate of PET staple and bottle products will be further lower than that in 2019. If the demand for polyester increased by 6.5%, the corresponding demand for polyester would be about 3 million 200 thousand tons, corresponding to the increment of PTA demand in 2 million 736 thousand tons. Therefore, it is estimated that after 2020, the overall PTA industry is facing a dilemma of slowing demand for polyester and oversupply of supply. This dilemma may last 3-5 years to truly alleviate.

First textile network reporter learned here that Hengyi Petrochemical has developed into one of the world's leading manufacturers of terephthalic acid and polyester fiber. The comprehensive competitive advantage has been in the forefront of the industry for many years. It mainly produces PTA, CPL, PET, PET, pet, FDY, dacron, polyester, etc.

Up to now, Hengyi Petrochemical Holdings has PTA production capacity of 13 million 500 thousand tons / year, polyester filament production capacity of 5 million 100 thousand tons / year, polyester short fiber production capacity of 800 thousand tons / year, polyester bottle production capacity of 1 million 500 thousand tons / year, caprolactam production capacity of 400 thousand tons / year. The market share of the company PTA and polyester fiber is at the forefront of the whole country. The company's participation in holding PTA capacity accounts for 30.76% of the total capacity of the country at the end of June 2019, and the control polyester production capacity accounts for nearly 18% of the total national polyester production capacity in the end of June 2019, and the market scale advantage is obvious, and the core competitiveness continues to improve.

Judging from the competitiveness of Hengyi Petrochemical's existing products:

First, the competitiveness of PTA products. (1) cost advantage. Ningbo factory PTA non PX production cost is the lowest in the industry, compared with other domestic similar device level, the advantage is obvious. At the same time, Dalian and Hainan PTA factory's non PX cost is effectively reduced, and maintain the leading position among peers. Secondly, the market discourse power is strengthened. Due to the leading competitiveness of the company's PTA capacity, the PTA capacity of the company accounts for nearly 40% of the effective capacity of the whole country. It has a larger capacity scale advantage and a strong bargaining power for upstream PX procurement. Third, the industrial chain integration is more perfect, and the advantages of the company's integrated operation are obvious. The balanced development of the upstream and downstream industry chain is the trend of the company's future development, and will bring more significant scale operation advantages for the company.

Two, the competitiveness of polyester fiber. (1) through differentiated production to meet the needs of market diversification, the core competitiveness of the company is reflected in the degree of differentiation of products. Second, the company focuses on product structure optimization, market supply and demand, and cost accounting, so as to promote the transformation and upgrading of the polyester industry and enhance the competitive position of the polyester industry in the same industry. (3) the company continues to promote intelligent production, data management and Internet marketing. Remarkable achievements have been made in the extraction of big data, continuous improvement of equipment production quality and product quality, factory big data and Internet marketing mode, continuous reduction of production and operating costs, precise positioning of inventory and market, and improvement of terminal market service efficiency.

Three, the competitiveness of CPL products. (1) technical superiority. Caprolactam is a cooperative project between the company and Baling Petrochemical Company. Relying on the unique leading technology of Baling Petrochemical, it also speeds up the industrialization process of caprolactam new technology, making the quality of caprolactam product under the new technology go up to a higher level and the production cost is further reduced. Secondly, the market discourse power is strengthened. The quality of caprolactam products is in the forefront of the industry. The future is aimed at expanding the market share of high-end caprolactam products. The high-end caprolactam products belong to the national encouraged development projects. The company will focus on mining the market space of high-end caprolactam products, replacing imports, promoting product structure optimization, stabilizing the leading position of the company, improving market share and increasing the voice of the industry. (3) scale advantage. The company's quality caprolactam continues to expand production scale, reduce production costs and improve market share. 4. Caprolactam industry chain has more scale, obvious location advantage and customer advantage.

Hengyi Petrochemical Related executives predict that the polyester industry profits in 2020 are expected to maintain at least or exceed the annual average level in 2019. In addition, raw material prices will be relatively low at the end of this year. Next year, the price fluctuation will be smaller than that in 2019. The risk of pet stocks falling will help to enhance the profit contribution of polyester. According to past experience, the profit is generally low during the Spring Festival, and the follow-up will gradually recover, plus the premium on inventory is expected to be better than in 2019.

Heng Yi Petrochemical believes that along with the continuous growth of the downstream textile industry, the growth of the export of emerging market countries, and with the promotion of the electricity market economy to the rural market, the improvement of people's living standard and the promotion of consumption frequency are expected to continue to grow rapidly in polyester products demand. In the first half of this year, polyester demand remained two digit growth. In addition, the supply growth rate of polyester products is decreasing in the future. The leading polyester industry chain has a prominent advantage. It is expected that the polyester industry chain profit is expected to rise.

According to the financial report, in the first three quarters of 2019, Hengyi petrochemical company achieved operating income of 62 billion 200 million yuan, down 6.37% compared to the same period last year, and the net profit attributable to shareholders of listed companies was 2 billion 210 million yuan, down 9.28% from the same period last year. Basic earnings per share of 0.78 yuan.