The Cost Is Going Up And The PTA Store Is In Progress.

One stone stirred up thousands of waves. On the eve of Christmas, the PTA market, which was originally adjusted for shocks, set off a wave of small waves, making the spot price of PTA rise from 4790 to 4850 yuan / ton. The spot processing fee is reduced to 404 yuan / ton. Although the increase is only 1.25%, it is not easy for the weak and volatile PTA market in the near future.

Fig. 1 price correlation diagram between PX and PTA

Source: lung Chung

PX prices rose 15 US dollars to 832.33 US dollars this week. During the week, the enthusiasm of buying the PX market was greatly improved, and the atmosphere in the market was very active. The rapid rise in raw material prices has driven the PTA market up. In December, Zhejiang Petrochemical and Hengli Brunei plant were put into operation successfully. At the same time, PX profit fell to below US $300 / ton. Due to the influence of Christmas day, the atmosphere of PX transaction has increased. At present, the processing fee of PTA is near 450 yuan / ton, and the price of PTA is down in the week. The main port source also shifted from the premium to the premium pattern. The upstream PX cost side support is acceptable. In the supply side, the Sino Thai 1 million 200 thousand ton PTA plant in Xinjiang was successfully delivered in the afternoon of December 25th, but the specific production time needs to be determined. The new capacity of Hengli Petrochemical 2 million 500 thousand tons has been postponed to the end of January, and the new PTA production will gradually increase in the future, and the supply of PTA will still be abundant in the future.

The Spring Festival is near and downstream.

Demand side, the recent polyester production and marketing as a whole light, multiple bad drag, polyester manufacturers more quotes stable. Although the PTA market is going up, it will drive a wave of market, and there will be a certain warehouse filling behavior downstream, but the overall cash flow of polyester is still at a low level. Downstream buying sentiment is more sluggish, and there is a lot of bad luck. The trading atmosphere is weakening. As of December 26th, the overall opening rate of chemical fiber weaving was 64% in Jiangsu and Zhejiang provinces, with a 6 percentage point decline. Specific to the professional production base, the average loom rate of loom loom in Shengze area is 73%, and the start-up situation is obvious. The majority of the looms above the 1000 looms are in 80%-90%, and the 100 ~300 small and medium sized enterprises have closed down for 2. Changshu's warp knitting enterprises have different performance rates. The average start-up rate is near 50%-60%, and some factories have lower start-up rates of 20%-30%. Market shipments have not yet been improved, the industry's production has increased, it is expected that the end of this month will continue to rise, the loom loom may appear a large area of downtime phenomenon.

Fig. 2 PTA actual demand load change

Source: lung Chung

Gradual accumulation of library structure

On the whole, for the raw material PX, profits are already at the edge of losses. In the short term or with potential crude oil, there may be a rise. But in the medium and long term, the PX market is fiercely competitive. The integration of small devices and short process devices will be phased out. At present, high opening workers are hard to sustain, and PX demand will be weakened. Next year, a large number of PTA installations will be launched, and the new capacity will reach 14 million 200 thousand tons in 2020. At present, the demand for off-season is coming, PTA12 month has entered the storehouse, the 1-2 month storage pool is expected to be determined, and the number of storehouses is up to 126 thousand and 800 tons by the end of December.