Saudi Energy Minister Prince Abdulaziz bin Salman said on Tuesday (May 23) that he would make short sellers pay and reminded them to be careful. WTI crude oil prices rose 2.3% as a result, reaching an intraday high of $73.98 per barrel, setting a new three-week high since May 2.
This good news stimulated the entire market, causing PTA spot and futures to rise immediately. Currently, the internal price of PTA is 5,550 yuan/ton, an increase of 60 yuan/ton from Monday. Although the increase in PTA this time is not large, currently, PTA has shown a downward trend throughout May. The good news on the 23rd reversed the trend and stepped on the “brake”.
Polyester filament production and sales nearly 200%
Affected by this, on the 25th, many polyester factories continued to increase the price of polyester filament by 50-100 yuan/ton. At first glance, it seems that the increase is not large, but you must know that this is the current price of the entire 5-year period. The only price increase in the month, and even dropped several times in the middle of the month. As the saying goes, “buy up but not down”, on the 25th, the focus of some transactions in the market moved upward. Under the guidance of the bullish buying atmosphere, downstream users covered their positions in an appropriate amount, and some production and sales increased. The average production and sales are 197.8%, nearly 200%! This is the highest production and sales in May, and only the second time. The news of rising crude oil is like a “heart-saving pill”, like polyester filament instantly coming back to life.
Nearly 200% of the polyester factory’s production and sales this time are due to the price adjustment of polyester yarns supported by the rise in crude oil. This is due to the mentality of cloth bosses to buy higher prices. But the editor believes that the most important reason is that this is just a regular month-end replenishment. In fact, we can also see from the polyester production and sales chart that in the past one or two years, production and sales at the end of each month will suddenly exceed 100. This kind of end-of-month replenishment operation has become a rule in the industry.
Will Boss Bu buy it?
As the same saying goes, a price increase is a price increase, but no matter how much it goes up, it’s useless if the downstream doesn’t buy it. After several years of “severe beatings” in the market, the current “threshold” for cloth bosses to do business is very precise, and it is difficult to fool them by raising prices to remove inventory. When visiting the market, when asked about their strategies for purchasing raw materials, many cloth bosses said that unless they received a lot of orders, they basically purchased at regular intervals.
Although the overall market in May has not declined significantly compared with the “Silver Four” market, the current ordering atmosphere in the downstream is weak, and June is about to come. Based on the experience of previous years, the market in June will gradually decline. . Therefore, from the perspective of terminal demand, it may be a negative factor for polyester filament.
Affected by the early decline in cost-side prices, the industry chain has achieved good profits and has successfully turned losses into profits. At the same time, the inventory of polyester factories is not high now, so they are traveling lightly and there is no pressure on production and sales in a short period of time. Under this premise, domestic polyester factories have reduced production in the early stage and overhauled polyester factories to gradually increase their loads. With the addition of new equipment put into operation, the output of the domestic polyester industry continues to increase. Compared with the periodic polyester load low point at the end of April, the current load increase in the domestic polyester industry has been close to 4 percentage points.
Summarize
Terminal performance is poor, but domestic polyester factories are more motivated to produce, low inventory pressure and improved profits will further support the increase in the load of the polyester industry. In the short term, the domestic polyester industry’s load is expected to further increase, and there are also positive factors for polyester filament.
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