Commodities rose in full swing in February, with some commodities even reaching record highs. The entire market demonstrated the strong demand recovery in the “post-epidemic stage” and the “inflation flow cycle” brought about by global monetary policy easing, which gave the market the greatest impact. The feedback is that commodity prices fluctuate upward and consumer demand strongly increases.
PTA, as the most important commodity futures in the industrial chain, has a complete product line and a unified structure, namely crude oil-naphtha-PX/BZ-PTA-PET and downstream weaving, etc. Therefore, which stage of the entire market the current PTA rise is in is the main content that investors, producers, and consumers are most concerned about.
Upstream and downstream resonance
Data show that from November 6, 2020 to February 10, 2021, the continuous price of WTI crude oil futures increased from It rose from US$35.5/barrel to US$58.5/barrel, an increase of about 64.5%, ranking first in the chemical industry. Its naphtha price rose from US$368/ton to US$551/ton, an increase of 49.7%, and its PX price rose from US$517/ton to US$745/ton, an increase of 44%. In the same range of the entire chemical products, the price of PTA rose from 3,350 yuan/ton to 4,140 yuan/ton. The overall price increased by 800 yuan/ton, an increase of about 25%. Related products such as ethylene glycol increased by 21%, and staple fiber increased by 21%. %, asphalt rose by 23%, styrene rose by 18%, methanol rose by about 10%, etc. Through data comparison, PTA is the commodity that follows the price of raw materials most strongly compared to other chemicals. In addition, compared with the upstream growth, the increase in the entire price of PTA is due to the increase in its cost end from the polyester chain. From a valuation perspective, it is still undervalued.
PX rises strongly
From the Spring Festival to last weekend, we can clearly see that the price of PX rose from US$745/ton on February 10 to 885-900 US dollars/ton, an overall increase of nearly 20%. At the same time, the PTA futures price rose from 4,298 yuan/ton to 4,870 yuan/ton, an increase of 13.5%. In other words, in this round where PTA seems to be rising faster and larger, PX is still rising more than PTA. PTA has not achieved full expansion of profits during its rise. Other commodities such as ethylene glycol rose by 36%, styrene rose by 32%, and polypropylene rose by 14.5%. Even in the chemical market, PTA’s growth rate is not at a high level, and it is not even a relatively strong player in the entire rising range.
So in this process, does the rise of PX meet the fundamental support?
It can be seen that PX itself will face continuous destocking after March. At the same time, PX maintenance paths are relatively concentrated. Before the aromatics production capacity of Zhejiang Petrochemical is put into operation, the tense situation may intensify. We believe that PTA’s center of gravity is rising simultaneously as its cost-end PX continues to rise strongly. Compared with the rise in raw materials, PTA itself is a passive follow-up process.
Focus on the degree of centralized maintenance
According to the author’s understanding, from March to April, PTA equipment faced a maintenance plan totaling 20 million tons, covering a total of 20 million tons of equipment There are nearly 10 manufacturing companies and 13 sets of production equipment. Judging from the spot market transactions, the basis difference is also extremely strong. This is precisely due to the previous sharp increase in raw material costs, which caused PTA to follow the price increase and lead to various units to carry out production maintenance in a planned manner. Whether this move will form a process from passive follow-up to active improvement, we need to Continue to observe the downstream situation.
So facing such a tense situation, as the consumer side of PTA, what is the current status of polyester companies?
Judging from the latest data, PTA and MEG have surged recently, and various polyester products such as POY, DTY, FDY, polyester staple fiber, polyester bottle flakes and polyester chips are all profitable. In particular, both the traditional largest downstream POY and the new star product staple fiber have extremely impressive profit structures. So, what is the inventory structure of these products, and can the current price allow it to be transmitted to downstream?
Inventories of polyester products have continued to decrease during this round of raw material price increases, and polyester finished products have been smoothly transmitted to downstream weaving. This has also fundamentally logically verified once again that the strong recovery of the global economy and demand is a direct result. feedback.
The downstream of polyester, the weaving industry, has continued to significantly increase its load after the Spring Festival, and the demand for polyester finished products has shown great purchasing power. Looking at the entire industrial chain structure, PTA’s own supply is beginning to show a tight situation, coupled with strong upstream support and favorable downstream support. Therefore, the current rise in PTA is still in a reasonable state, and the healthy conduction of the industrial chain is the biggest cornerstone of market development. </p
