Introduction: The recent PTA market has taken turns between rising and falling. At the beginning of the week, the spot price of PTA once rose to 5,507 yuan/ton. However, as U.S. commercial crude oil inventories unexpectedly increased significantly, the rapid spread of the Delta mutant strain dragged down the economy and demand expectations, and international oil prices fell sharply. In addition, PTA’s early stage equipment was restarted one after another, and the PTA market fell with the trend, with a drop of 4.9%. However, at the opening of the 9th, short covering combined with the decline in the US dollar exchange rate, and the international oil price rebounded. The PTA market fluctuated upward. So as the intensification of the epidemic brings double worries to the economy and demand, but PTA’s own supply and demand are relatively optimistic, where should PTA go in the future?
Table 1 Recent PTA device maintenance trends
Source: Longzhong Information
In terms of supply and demand, PTA has performed steadily. Recently, there have been more maintenance of PTA equipment, and the load has dropped to 70.97%. The polyester load has remained high, and supply and demand destocking has continued. And spot liquidity continues to be tight. However, the PTA processing margin has recently climbed to a high of 800 yuan/ton, coupled with polyester cash flow losses and terminal demand recovery that is less than expected, dragging down the upside of PTA. Therefore, PTA has shown an up-down-up trend recently. The average weekly operating capacity of the polyester industry was 89.34%, down 0.84% from last week. The reason for the decline in output and start-up is that the pre-production units continued to increase their load during the week, such as Keqiao Hengming, Nantong Hengke, etc. However, due to the impact of the epidemic on raw material supply, logistics and transportation, and profitability, some units also reduced production and underwent maintenance. Such as Yizheng Chemical Fiber, Huayi, Huivis, etc. Domestic polyester output fell within a narrow range.
Table 2 PTA supply and demand balance sheet
Source: Longzhong Information
Judging from the supply and demand balance forecast, both restart and maintenance of PTA equipment will exist. Among them, Fuhai Chuang’s 4.5 million tons, Ningbo New Materials’ 3.6 million tons, and Ningbo Taihua’s 1.2 million tons units have resumed restarting after maintenance; Sanfangxiang’s 1.2 million tons units, and Xinjiang Zhongtai’s 1.2 million tons units have entered a shutdown state. As a result, supply has shifted significantly downwards. Although some polyester companies have stopped, the overall load is still relatively high, and the demand for PTA remains rigid. Overall, supply and demand still continue to be destocked.
Forecast of the market outlook:
The epidemic has intensified recently, dragging down the global economic recovery. , suppressing the rise in oil prices and slightly dragging down the commodity market. The start-up of raw material PX remains low, the PX-N price difference is still at a reasonable level, and the cost side is volatile, maintaining temporary stable support for PTA. From the perspective of supply and demand structure, the fundamentals of supply and demand are still stable. In addition, the spot circulation of PTA is still tight, the warehouse receipts have been significantly reduced, and the supply and demand still maintain a destocking pattern during the month. However, the current cash flow loss of the polyester end and the recovery of terminal demand that is less than expected may be a drag on the rise of PTA. Therefore, under the background of the epidemic and crude oil not having major negative effects, PTA is still in a volatile and strong trend. </p
