PTA Or Check 4950 Yuan / Ton Pressure Level.

Due to lower processing costs and cost side support, PTA will rebound in the near future. But considering the overall oversupply, it is expected that the PTA rebound time and amplitude will be limited.

The picture shows the PTA basis and the amount of warehouse receipts.

Last week, PTA futures rebounded on the rise of international crude oil prices. Technically, the price of PTA futures contract fell below 4950 yuan / ton after strong support, but it did not fall below the support of 4650 yuan / ton in the past 3 and a half years. The recent price or inspection of 4950 yuan / ton pressure level was 2001.

Processing fees are low.

Affected by the Sino US trade friction, domestic textile demand has not performed well this year. Because the market uncertainty is higher than in previous years, most of the terminal textile enterprises are stocked according to orders, and their willingness to hoard goods is not strong. Because the raw materials of terminal procurement are not active, the demand for chemical fiber is greatly affected, which makes PTA consumption weak. According to statistics, as of November 21st, the average annual PTA load in China was 83.73%, up 0.79 percentage points from the average level last year. Due to the high supply of PTA production enterprises, and the 4 phase of Sichuan Shengda, Xinfeng Ming, Hengli, and Zhongtai chemical plant put into operation, the market supply pressure is increasing. Under the effect of oversupply, PTA futures prices continued to decline.

However, with the continuous decline of PTA prices, the operation of PTA production enterprises is also deteriorating. At present, the processing fee of domestic PTA industry has dropped to 500 yuan / ton low, and the industry average loss is 60 yuan / ton. Under such circumstances, the enthusiasm of PTA enterprises has declined. In mid November, 900 thousand tons of capacity of Peng Wei Petrochemical Company, 1 million 200 thousand tons of Ningbo's Taiwan chemical capacity, 750 thousand tons of Ya Dong Petrochemical capacity, and 1 million 500 thousand tons of Jiaxing Petrochemical capacity will be overhauled, but the maintenance period is not long.

The role of cost support

At the present low cost of PTA processing fee, the cost will gradually show the support role of PTA. Under the premise that the cost center of gravity does not move down, the price of PTA will be relatively lower and the downlink space will be smaller. From the cost point of view, as the OPEC will hold Ministerial Conference in early December, the market expects that the OPEC will introduce more intensive production reduction policies, coupled with the continued decline in the number of active drilling in the United States, the increase in inventory is less than expected, and the heating oil consumption will enter the peak season, and the price of crude oil will remain relatively strong.

Because of the rising cost, the performance of the upstream PX price is relatively strong, and the price of Korea FOB is stable near 763 US dollars / ton, so the PTA cost terminal is stable or slightly rising probability. Under this judgment, if PTA price stabilizes or falls, the processing fee will be further compressed and the loss will be further expanded, which will force enterprises to stop or limit production and protect prices. The author thinks that, considering the low processing cost and relatively stable cost, PTA disk price or rebounded to repair the current low processing fee. Moreover, the recent trend of PTA futures is weaker than spot, and the basis is widened, and the registered warehouse receipts have declined significantly. With the decline of warehouse receipts and the loss of some base trading positions, the sell-off weakened.

The market is relatively light.

In the next 2-3 years, there will be several large refinery plants in China, and PTA production capacity will enter a new period of rapid growth. At the same time, the early easing of Sino US trade frictions has been repeated in recent years, taking into account the long-term trade frictions between China and the United States and the demand for overdraft in the early stage, the latter is still not optimistic. Under such a big background, PTA can hardly change the weak pattern.

In the short term, the polyester load will be stable next week, and no new maintenance plan has been announced. But from the market trading situation, the turnover of staple fiber and bottle piece is very sluggish. Considering the end of the winter clothing consumption stock market, the demand for PTA will be weak.

Based on the above analysis, PTA prices continue to decline, resulting in continuous compression of processing fees. At the same time, because the cost side does not have the possibility of a sharp fall, the price of PTA will be further limited. However, in the long run, due to the peak of PTA production capacity, the pattern of oversupply is deteriorating. Short term demand is also difficult to provide impetus for price rise in the off-season. Therefore, this round of PTA rebound time and amplitude are limited, it is recommended that every Rally test.