In March, the polyester market came to a dismal end. Whether it was the upstream raw materials PTA and ethylene glycol or the downstream polyester filament, polyester chips and other products, the prices dropped significantly, and the decline was around 10%. Therefore, in the WeChat questionnaire survey, most industry insiders obviously lack confidence in the market outlook. Faced with the passing of the “Golden Three”, they believe that there is little hope for the “Silver Four” peak season…
“Take off your long johns and put on spring clothes”, the polyester market has begun to become “restless”
However, the market never follows the routine. April is the most beautiful day in the world. Entering April, the polyester market finally couldn’t help but “take off your long johns and put on spring clothes”. After the early coolness, it started to get hotter.
On the first day after the long holiday (April 5), polyester factories began to offer prices, cancel discounts, increase prices, and limit sales! On April 6, polyester factory quotations were still mainly driven up. For example, Hengyi FDY increased by 50-100 yuan/ton, POY increased by 50 yuan/ton; Far East POY all increased by 100 yuan/ton; Yifeng increased by 100 yuan/ton. tons; Wuchang increased by 50-100 yuan/ton; Shenjiu increased by 100 yuan/ton; Lianda increased by 100 yuan/ton, no discount; Yuanzheng POY increased by 100 yuan/ton; Jiabao increased by 50-100 yuan/ton; Tongkun POY increased by 150 yuan/ton; Sanfangxiang canceled the 200 yuan/ton discount; Southeast new material discount reduced by 100 yuan/ton; Kaishi FDY50D-100D increased by 50 yuan/ton, 120D-150D increased by 100 yuan/ton, POY generally increased by 150 yuan/ton; Xinmin POY increased by 50 yuan/ton, and other preferential policies were reduced by 100 yuan/ton; Xinfengming POY generally increased by 100-150 yuan/ton…
Some manufacturers even increase prices more than once in a day!
Some manufacturers have simply closed the market and not sold it! It forced the downstream to “popularize poetry”…
Driven by the booming production and sales, the price of polyester yarn has made up for the increase, while downstream buyers are still enthusiastic about buying. According to statistics, the average market production and sales on the 5th were as high as over 300%, and individual manufacturers’ production and sales surged by 500-600%. The market has seen a long-awaited destocking trend. However, whether the market outlook can continue to exert strength depends on the cooperation of upstream and downstream companies.
Polyester filament adjustment is in place, rebound begins?
In March, the polyester filament market continued to fall, mainly due to the suppression of its own high inventory and insufficient support from upstream raw materials. Therefore, whether the market outlook can continue to rebound still needs to be viewed from these two aspects:
First of all, the crude oil market is exhausted, and the implementation rate of OPEC production cuts will also support oil prices. Since OPEC implemented the production reduction agreement this year, although the market has been full of doubts about the implementation of production reductions, so far, OPEC’s overall implementation rate is obviously better than before. OPEC recently stated that it will continue to strictly implement the production reduction agreement, and the production reduction implementation rate of non-OPEC countries will continue to increase. If global inventories are still high by then, extension of the production cut agreement cannot be ruled out.
Crude oil rebounded strongly again on the 5th, with WTI prices rising 1.69% to 51.09, and Brent prices rising 2.11% to 54.24. On the evening of the 5th, the EIA (U.S. Energy Information Administration) will release its official data. According to expert survey data from Bloomberg, U.S. crude oil inventories Volumes may have fallen by 150,000 barrels last week. In addition, API data showed that crude oil inventories will shrink by 1.83 million barrels.
Secondly, equipment maintenance will support the price of raw material PTA. Since there are many maintenance plans for PX in the second quarter, the supply of PX will be tight and its price will rise. The cost side will still support PTA. As far as PTA itself is concerned, the production capacity involved in the maintenance in April is about 6.3 million tons. If calculated based on an operating rate of 75%, the overall output may only be 2.7 million tons, resulting in a periodic tight supply. With the 2.2 million tons/year unit of Hengli Petrochemical Line 3 and the 3.75 million tons/year unit of Yisheng Chemical scheduled to be shut down for maintenance around the beginning of April, and the 400,000 tons/year Tongkun polyester filament unit scheduled to be put into operation, PTA will be alleviated to a certain extent. Supply pressure boosts PTA and downstream polyester filament markets.
Summary: To sum up, it is obvious that the upstream raw materials have been quite strong recently, and will support the price of polyester filament in the later period. Then everyone’s focus is still on the terminal fabric market.
Although the price of polyester filament was at a low level in March, many weaving manufacturers were afraid of losing money and did notDare to stock up in batches. After this period of consumption, we have reached the point where we should replenish the goods, but as for the intensity and persistence of the replenishment, it remains to be seen. After all, it will take time for chemical fiber manufacturers to digest the high inventories. Unless the inventories are transferred smoothly, the rebound may be just a false shot.
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