PTA, MEG, and staple fiber all belong to the upstream and downstream varieties of the polyester industry chain. PTA and MEG are both polyester raw materials and face the same downstream, but they show different trends due to different performance of their respective supply ends. Judging from recent trends, although the three varieties of the polyester industry chain are all dominated by cost-side fluctuations and the oscillations have intensified, the trends of the “three brothers” still show great differentiation.
The core difference comes from the supply side
In fact, the trends of the three varieties of the polyester industry chain The differentiation is related to their respective fundamentals, and this phenomenon has existed since the beginning of the year. For now, the core difference between the three varieties comes from the expectations on the supply side. The supply sides of PTA and MEG are under greater pressure to expand, while short fiber link factories are expected to reduce production.
“Under the expectation of high inventory and high production, PTA prices have been fluctuating around the cost valuation, and the trend is basically consistent with the international crude oil price; in terms of short fiber, due to being closer to the downstream , the price is more directly affected by the downstream textile market. Once the downstream orders are weak, short fiber profits will be quickly compressed.” Zhu Lihang, an analyst at Zheshang Futures, said that MEG, as the only liquefied variety among the three varieties, has a negative inventory value. After falling, the game between strong reality and weak expectations continues. In the process of changing supply-side expectations, price fluctuations become more severe.
“As far as PTA is concerned, since 2021, the production capacity has been concentrated in the first quarter. According to statistics, the new production capacity of Baihong Petrochemical and Honggang Petrochemical has been put into production, which is 5 million tons, compared with last year. It increased by 8.7% at the end of the year, and the suppression of the market supply side is more obvious.” Hongye Futures analyst Zhang Yongge told the Futures Daily reporter that the upstream source of PTA is relatively single, from crude oil to naphtha to PX to PTA. Crude oil has a significant impact on the market. cost support role. After March, due to insufficient demand follow-up, the processing profits of the PTA industry were greatly reduced, and the industry began to overhaul and raise prices. “In the second quarter, PTA’s monthly output losses due to maintenance were more than 900,000 tons, which also caused price declines to be supported by costs, while increases were subject to high inventory and weak supply and demand,” she explained.
Unlike PTA, MEG’s import dependence is still high. At the end of 2020, 54.8% of domestic MEG still needs to be imported. The market should pay attention to both domestic supply and foreign imports. aspects of the impact.
“At the end of April, the satellite petrochemical plant was put into operation. At the same time, Shaanxi Yanchang, Weihe Chemical, Jianyuan Coal Coking and other coal-making plants were put into operation, and the production capacity reached a new level. However, Overseas supply conditions have been frequent. First, hurricane weather in the United States caused unexpected shutdowns of equipment, and then equipment maintenance in Iran and other countries brought certain uncertainty to the import market.” According to Zhang Yongge’s analysis, since March, MEG port inventory has been at At the low level of 500,000 tons, the actual spot stock is tight, and the supply and demand side after the new production capacity is expected to be put into production in the later period and stable operation is relatively pessimistic, showing a situation of “strong reality and weak expectations”.
In the view of Zheshang Futures analyst Zhu Lihang, both PTA and MEG have put into production a large amount of new production capacity this year, which will have a greater impact on the supply side. With the demand side growing steadily, , the loose supply and demand pattern makes the fundamental situation of PTA and MEG difficult to say optimistic. Relatively speaking, there is less short fiber production capacity this year, and supply and demand are basically balanced or even tight.
“At present, the expectations for this year have not changed much. Although in the short term due to the tight supply situation, the MEG trend once led the polyester sector, but in the long term, with the As the new production capacity of PTA and MEG is gradually implemented, and after the subsequent recovery of downstream demand, the trend of short fiber is still the most worth looking forward to.” Zhu Lihang analyzed.
The trend of short fiber is favored by the market
From the perspective of the industrial chain , staple fiber is the variety with the best fundamentals, mainly because there is little pressure on supply and demand.
According to Zhang Yongge, only Shandong Chenghuijin is expected to put into production 150,000 tons of short fiber this year, and Huaxi Chemical Fiber, Yida and Xinfengming have a cumulative production capacity of 1 million tons. Release, but basically concentrated in the fourth quarter. She said: “Even if all new production capacity is released, the growth rate of production capacity this year will only be 14.5%. Since short fiber is the variety closest to the weaving terminal, once demand picks up, the short fiber segment should be the first to benefit.”
“In the short term, the performance of short fiber is relatively weak. Although the start-up has increased slightly, the inventory has gradually accumulated from negative to positive, factory profits have been significantly compressed, and the fundamentals have weakened. Terminal On the other hand, the current start-up performance of downstream yarn mills is satisfactory, and orders at the weaving end have improved. Under the influence of the shopping festival, summer orders have increased, but the recovery of overseas demand is still slow and overseas orders are low.” Dadi Futures analyst Jiang Shuopeng told reporters, However, from the perspective of long-term fundamentals, the new short fiber production capacity has been put into production. Compared with the upstream PTA and MEG, the future supply pressure is relatively small. At the same time, the market has positive expectations for overseas terminal demand. The short fiber varieties in the polyester industry chain Medium is the variety with the best long-term fundamentals.
In this regard, Guotai Junan Futures analyst Huang Tianyuan also said that looking forward to the second half of the year, he will still be optimistic about the trend of polyester staple fiber. In the first half of the year, the weakness of short fiber was not caused by the imbalance between supply and demand, but a reflection of continued negative feedback at the industry level; in the second half of the year, with the arrival of the “Golden September and Silver Ten” peak seasons and the recovery of global travel demand, crude oil prices rose, demand recovered, and costs Recovery, short fiber will then start a new round of positive feedback. ”
Recently, the supply and demand side of PTA has increased sharply.The transformation is weak, and supply-side maintenance is still relatively high. However, after the recovery of early equipment, the spot market circulation has eased, while there are still variables after the delay in the commissioning of new equipment. At the same time, downstream demand has begun to weaken. After the short-term improvement of terminals, the long-term sustainability remains to be seen, and the recovery of overseas demand is slow. “On the whole, except for the strong increase in crude oil at the cost end, new drivers for PTA have not yet emerged.” Jiang Shuopeng said.
“MEG’s fundamentals have gradually shifted from tight to loose, which will improve the low inventory situation at ports. It is expected that inventory accumulation may occur in late June.” According to Jiang Shuopeng’s analysis, due to profit Due to the impact of the epidemic, domestic production has been reduced, and the short-term import recovery is less than expected. It is expected that imports will recover in June. At the same time, the commissioning of new domestic devices will increase domestic supply and is expected to remain a major negative factor.
During the interview, the reporter learned that the current influencing factors of the polyester industry chain come from the cost end, including crude oil and coal prices. When there are significant fluctuations, the impact will be on the cost end. The price of the polyester industry chain brings a greater driver; on the other hand, the terminal recovery situation, that is, the pace of demand recovery under the influence of overseas epidemics. In addition, it is also subject to the commissioning of new production capacity of polyester raw materials PTA and MEG.
“As the market evolves in the future, PTA needs to pay attention to the cost-side drivers. Under high inventory and high production expectations, PTA prices will still be based on cost-side pricing for a long time to come. .” Zhu Lihang said that under the expectation of accumulation of stocks, MEG prices have fallen to near the profit and loss line, and there is less room for further compression of profits; the current profits of short fiber have been compressed to historical lows, and there is not much room for further weakening. We should pay attention to the market outlook. After demand gradually recovers, there is an opportunity for profits to rise. </p