Overnight oil prices recorded their largest single-day decline since May. Cost-end guidance PTA fell 3.08% during the day to close at 4,974 yuan. Short fiber showed a certain resilience and rebounded in the afternoon to close at 1.96% lower. Its confidence came from another raw material – ethylene glycol. Ignoring the plummeting oil prices, it once bucked the trend and rose by more than 2%. However, it struggled in late trading and was quoted at 5,341 yuan.
The financial market was in turmoil on the 19th. The three major U.S. stock indexes fell sharply. The performance of U.S. bond yields was also unsatisfactory. Oil prices created the largest decline since September last year. It fell more than $5 a day. The raging epidemic has caused some panic in the market. Growing global inflationary pressure and the United States’ aversion to inflation have also made the market more cautious. Market sentiment exploded under multiple pressures. Although the agreement reached by OPEC is beneficial to the fundamentals of crude oil, it is driven by the macro wave and dominates the direction of the crude oil market.
PTA has been following the lead of oil prices in the context of low processing fees. After the oil price plummeted, the main force fell to the 5,000 yuan mark, but there was no significant change in the market position. Fundamentally, from the supply side, Luoyang Petrochemical restarted last Sunday, but spot supply in some areas is still relatively tight, resulting in a solid basis performance and continuous outflow of warehouse receipts. The reduction in social inventory mainly comes from the continued reduction of warehouse receipts.
In terms of demand, a total of 850,000 tons of polyester in Xinfengming and Hengyi Haining has been successfully put into production in July. In addition, a new 600,000-ton plant in Hengming Chemical Fiber is expected to run from the end of July to August. The company has plans to put into production, so demand is given strong support. In addition, polyester will enter the traditional peak season in August, especially with the recent news of improvement in foreign trade orders and the recovery of downstream polyester production and sales, boosting the rising atmosphere in the PTA market. However, this year the market has been in a state of not being weak during the off-season. Some industry players have doubts about whether it will really be hot in the upcoming peak season.
The obvious strength of ethylene glycol comes from the substantial depletion of inventory in the main port. Funds have driven the price to continue to be strong. Yesterday, the spot price in East China closed up to 5386 yuan/ton. Due to the increase in overseas maintenance, although import inversions have narrowed, the import window is still closed. In addition, with rising sea freight, the overall import volume has not increased significantly, and there is still no obvious pressure on the supply side. </p
