On the first day after the Spring Festival, affected by the sharp rise in crude oil during the holiday, the polyester sector showed strong trends, with staple fiber and ethylene glycol rising by their daily limits, leading the chemical sector. The reporter observed that on the first trading day after the holiday, polyester chain futures prices rose sharply across the board. Among them, ethylene glycol and short fiber futures were closed at the daily limit, closing at 4,986 yuan/ton and 7,734 yuan/ton respectively. The prices have hit their highest levels since last year. new high. PTA futures rose relatively less, but also increased by 4.17%. The performance of the polyester “brothers” on the 18th surprised many people in the industry!
According to feedback from several textile factories in Shandong, Henan, Hebei and other places, the new crown epidemic was effectively prevented and controlled during the Spring Festival. The epidemic growth in Europe and the United States and other countries has reached an inflection point, and vaccination in the United States has accelerated. Superimposed on the sharp rise in crude oil, energy, metals, ICE cotton futures and other bulk commodities during the Spring Festival, textile companies shortened their holidays and informed employees to return to factories as soon as possible to resume work. It is understood that some yarn mills in Changle, Fujian Province have started operations on the fourth day of the Lunar New Year, and by the seventh day of the Lunar New Year, the local operating rate has reached 60%-70%. In previous years, it was basically not until the eighth or even the fifteenth day of the Lunar New Year that the yarn mills started to start operations one after another. The factory’s domestic and foreign trade orders are supported.
All products in the polyester industry chain have shown a good momentum of rising volume and price, making a good start for 2021. The volume and price transfer data also revealed an interesting phenomenon: the price trend of various products in the polyester industry chain in January 2021 is highly similar to the trend in January 2016 five years ago. Is this a coincidence, or is it a repeat of history under similar economic conditions and industry patterns? In the next 11 months, will the trend of the polyester chain remain similar to that of 2016?
In January 2021, the prices of most products in the polyester industry chain went out of a pattern of first rising and then falling, and there was a tail-off in the last one to two working days at the end of the month. In January, the prices of products in the polyester industry chain all increased month-on-month, but compared with the same period last year, they fell by more than 10 percentage points year-on-year. Among them, the prices of PTA and polyester chips fell by more than 20% year-on-year. The data also revealed that the price level of the entire industry chain was highly similar to January 2016.
Similar price levels and trends
Mark Twain once Said: “History does not repeat, but it rhymes.” In January 2021, in addition to PTA, other major products in the polyester industry chain (PX, ethylene glycol, polyester chips, polyester bottle flakes, polyester filament and polyester staple fiber), both in terms of average price levels and price trends, They all show obvious similarities to the same period five years ago, that is, January 2016.
Another coincidence is that the Spring Festival in 2021 is in February like 2016, and in February 2016, the polyester industry chain had many products. out of a moderate upward trend. The whole year of 2016 was a good year for the polyester industry chain: prices rose in the first quarter and then ushered in a period of platform fluctuations, and in the fourth quarter there was another industry-wide price increase.
Can the “coincidence” continue after February?
Will this similar trend continue in February 2021? Or does the trend of the polyester industry chain in 2016 have some reference for predicting the market in 2021? The underlying factors driving the price trend of the polyester industry chain include crude oil prices, macroeconomic conditions and industry patterns. The macroeconomic conditions determine terminal demand, crude oil prices determine upstream costs, and the industry pattern affects the supply and demand of each link in the industry chain.
Judging from the current situation, polyester raw materials will remain strong in the near future, and the core logic still revolves around the continued reduction of inventory and the firm cost-end oil prices. At present, oil prices have risen to more than 60 US dollars per barrel. Its trend will continue to affect the market in the future, dominating the price focus of the polyester sector. However, another factor that has a greater impact on prices is still supply and demand.
“Downstream consumption was relatively optimistic before the holiday. Boosted by rising oil prices after the holiday, the preference will continue to be maintained. Therefore, domestic supply and demand are expected to maintain a prosperous situation. However, the focus of the market may be concentrated In terms of oil prices, rising oil prices drive up costs and stimulate downstream stocking and consumption. However, once oil prices adjust and the downstream market atmosphere weakens, it will inevitably lead to deep adjustments in the market.” Industry analysts said.
In short, at the beginning of 2021, the polyester industry chain has shown a moderate upward trend. In the analysis of the volume and price data of the polyester industry chain, we found that the price levels and price trends of many products in the polyester industry chain are highly similar to those in early 2016. The reason is that whether it is the trend of upstream oil prices or the global macroeconomic fundamental environment, the situation in 2021 is likely to be similar to that in 2016.
Under the premise that this inference is established, it can be expected that the price of the polyester industry chain is expected to recover moderately in 2021. However, on the other hand, the production capacity launch cycle in the industry is different from that in 2016. The situation is quite different, which will mainly affect the profit distribution among various links within the polyester industry chain, and the production capacity deployment progress of each industry has also become an important source of fluctuations in the industry chain, which deserves further attention and in-depth analysis. </p
