After the Spring Festival, the price of the polyester sector has risen again and again. On the 23rd, the main contract of polyester short fiber futures, one of the polyester sectors, rose again. The cumulative increase of short fiber futures (2105) in the four days after the holiday was nearly 12%. In the spot market, polyester staple fiber factories are generally in a negative inventory stage. Relevant analysis believes that the short fiber market has strong support from both supply and demand and cost ends, and “gold, three, silver and four” can be expected. In the A-share market, Hengyi Petrochemical (000703.SZ), Sanyou Chemical (600409.SH), and Xinxiang Chemical Fiber (000949.SZ) all have plans in the short fiber field.
Short fiber futures prices hit new highs
“Quotations have increased in the past few days after the holiday. Futures prices have risen, and our current prices are also rising. Currently, factories are seriously oversold and spot liquidity is tight. To get the spot price, we have to increase it again.” A short fiber trader told reporters.
On Monday (22nd), the price of short fiber futures once exceeded 8,000 yuan, a new high since its listing. According to data from SunSirs, the spot price of short fiber has risen strongly. On the 23rd, a factory quoted 1.4D*38mm polyester staple fiber at 7,850 yuan/ton, which was 550 yuan/ton higher than the price on February 18. The advance payment price of Sinopec’s direct-spun polyester shorts contract in February was also raised.
He Qing, a polyester industry analyst at Zhuochuang Information, said that the main reason for the overall price increase after the holiday is the increase in cost-end prices. U.S. crude oil prices rose during the Spring Festival holiday, and the overall cost side strongly supported price increases. In addition, on the supply side, although the operating rate is higher than the same period in previous years, the inventory is oversold before the holiday. Downstream orders continued until mid-to-late March, and price transmission was relatively smooth.
“Gold, Three, Silver and Four” can still be expected
Polyester staple fiber can be mainly used in spinning, non-woven and filling three areas. The reporter learned from a practitioner engaged in cotton yarn trading in Anhui that yarn prices have also increased significantly recently. And according to his observation, there are still rising expectations in the short term. According to the practitioner, the work of downstream customers such as knitting and cloth downstream of cotton yarn has gradually resumed.
“The pace of recovery is much faster than in previous years. There have been many customer inquiries in the past few days, but due to price reasons, customers with inventory are in a wait-and-see mood.”, said the above-mentioned cotton yarn practitioner.
Some analysts believe that although the current increase in product prices is generally affected by raw material prices, it is good for polyester factories. From the perspective of the entire industry, rising prices can push polyester factories to expand cash flow and profits.
On the evening of February 18, Hengyi Petrochemical announced that the company’s subsidiary Haining Hengyi New Materials Co., Ltd. is building the fifth set of production line D of the “1 million tons annual output of differentiated environmentally friendly functional fiber construction project” The supporting projects related to the line (capacity 250,000 tons/year) have been put into operation recently and are producing qualified products normally. As of now, the company’s total polyester fiber (filament and staple fiber) production capacity has reached 7.25 million tons.
At noon on February 23, Sanyou Chemical responded to investors on Huayiyi that the company’s viscose staple fiber production capacity is 780,000 tons/year, and it is currently operating at full capacity, and the price will follow the market.
The industry is generally optimistic about the later price of short fiber. He Qing said, “The current negative inventory of short fiber may last until April to May. Overall, the supply and demand fundamentals of short fiber or overall polyester products in the market are strong. Conservative estimates suggest that the market will be relatively optimistic in the first half of this year. . But we must also pay attention to the trend of the cost side. There are many market adjustments due to fluctuations in the cost side or emergencies.”
Polyester filament: The rise in February has become a reality. The foregone conclusion
After experiencing the trough period in 2020, the rise of polyester filament has continued since 2021. The main driving force comes from the cost end. However, the raw materials still have upward momentum, and the rise of polyester filament has continued. It may last until early March.
Figure 1 Price trend comparison of mainstream polyester filament models from 2018 to 2021
Source: Longzhong Information
In recent years, since the large-scale refining and chemical project was put into operation, polyester filament has followed the trend of PTA and has shown a downward trend. In particular, the sudden epidemic in 2020 has caused a setback in the entire chemical fiber industry. As the main textile and clothing fabric, polyester filament has also Not immune to this, after experiencing a trough in the first half of 2020, polyester filament yarn has gradually embarked on a rebound. Especially from the end of 2020 to the present, polyester filament yarn has enjoyed great growth relying on cost support.
Figure 2 Comparison of mainstream polyester filament models and raw material price trends
Source: Longzhong Information
In the near future, oil prices continue to rebound during the Spring Festival holiday, vaccines are making good progress, and the global trade environment has improved during the new U.S. administration. Cold wave weather in the United States has also shut down many ethylene glycol units, triggering supply concerns. The ethylene glycol festival Later, futures prices reached their daily limit frequently. PTA Yisheng’s Hainan unit was unexpectedly shut down during the holidays, and the overall supply was lower than market expectations. The increase in oil prices boosted market sentiment. The short-term support period is now in the market. After the holiday, dual raw materials showed a sharp increase. Under cost pressure, polyester filament yarn Enterprise quotations have been raised one after another, and the market has been raised by a total of 600-700 yuan/ton.
As of now, the discussion reference for POY150D/48F in the polyester filament market in Jiangsu and Zhejiang regions is 7450-765.0 yuan/ton, the negotiation price for FDY150D/96F is 7550-7675 yuan/ton, and the negotiation price for DTY150D/48F is 8950-9100 yuan/ton.
Cotton still has room to rise after breaking through Wanliu
In 2019-2020, there will be many unfavorable conditions such as international economic and trade frictions and the global new crown epidemic. Factors came one after another, the cotton market experienced ups and downs, and the price of Zheng Cotton’s main chain ushered in the second major trough since its listing. The market is changing all the time. Since October 2020, cotton has been going all the way, with Zheng cotton and Zheng yarn rising sharply. On February 23, 2021, the highest price in the main trading session of Zheng Cotton was 16635, the highest price in more than 29 months. The highest price in the main trading session of Zheng Yarn was 24435, the highest price in more than 21 months. The spot prices of cotton and cotton yarn followed Strong emotions.
2020-2021 Domestic Xinjiang cotton and domestic cotton yarn average price trend chart
As shown in the figure above, on February 23, 2021, the average price of domestic Xinjiang cotton 3128B The price is 16,905 yuan/ton, an increase of 3,416 yuan/ton from the same period last year, an increase of 3,964 yuan/ton from before the National Day in 2020, and an increase of 1,103 yuan/ton from before the Spring Festival; the average price of domestic cotton yarn C32s is 25,010 yuan/ton, which is higher than last year. During the same period, it increased by 1,898 yuan/ton, which was 4,449 yuan/ton higher than before the National Day in 2020, and 1,231 yuan/ton higher than before the Spring Festival. After the holiday, Zheng Cotton quickly broke through the 16,000 mark and is currently oscillating in the 16,200-16,400 range. How long can the bull market last?
According to statistics from My Agricultural Products Network, as of February 19, the domestic commodity cotton inventory was 4.3869 million tons, a year-on-year decrease of 413,800 tons. The fundamental performance is relatively optimistic. Before the Spring Festival, yarn mills carried out a round of purchasing and stocking up. After the holiday, the situation of receiving orders was not good, and the willingness to purchase in a short period of time was low. Therefore, the author believes that the post-holiday market situation may have little direct connection with the fundamentals of domestic cotton.
OPEC extended its production reduction measures to the first quarter. Last week, Texas suffered a heavy snowstorm, which caused a sharp reduction in U.S. oil production. International oil prices continued to rise, driving up commodity prices including cotton and oil. The performance of downstream products and cotton substitutes – PTA is even more impressive. PTA futures rose by more than 3% on February 18, 22, 23, and 24, and hit the daily limit on the 23rd. At the same time, under the combined influence of factors such as the weakening of the U.S. dollar index, tightening of U.S. cotton year-end inventories, and the decline in cotton planting intentions in the next year, ICE U.S. cotton has recently reached consecutive new highs.
The OPEC meeting will be held on March 4. According to industry analysts, OPEC may increase production in April, while the oil production capacity of other countries and regions is in the growth recovery period. In 2020, my country’s textile companies took the lead in getting rid of the impact of the epidemic and successfully resumed work and production in March. Since then, they have received one after another textile and clothing orders from India and Southeast Asia, with high order saturation. As the global epidemic situation gradually improves, cotton spinning production capacity in India and Southeast Asian countries gradually recovers. With the delivery of these inward orders, foreign trade orders may gradually reduce to normal levels.
Analysis by industry insiders
Founder Futures Research Report believes that looking forward to the market outlook, we still maintain an optimistic attitude towards the fundamentals of short fiber. In the short term, downstream yarn mills will mainly digest raw materials and stock up, and futures prices will be adjusted at a high level. But in the later period, “gold, three, silver and four” can still be expected.
Longzhong research shows that as of February 24, the comprehensive start-up rate of chemical fiber weaving in Jiangsu and Zhejiang has increased to 44.50%. It is expected that the weaving start-up load will increase to 80-90% by the end of February, and the weaving industry will basically return to normal in early March. operation. However, due to the rapid growth of polyester and raw materials at this stage, the excessive growth has aggravated market risks. The downstream mentality is cautious, and end users are hesitant to “place orders”. The orders of weaving enterprises have not yet seen a significant improvement after the holiday. On the whole, the cost-side support can last until around mid-March. Whether this round of price increases can be transmitted downward to the terminal and digest the increase is the key to affecting the market trend of polyester filament in March.
The traditional gold, three, silver and four seasons of textile and clothing are coming soon, and with the superposition of good macro news, cotton prices may have room to rise. Although cotton has strong financial attributes, it is greatly affected by policy regulation. The acceptance capacity of the downstream and terminal consumer markets needs to be considered. Please continue to pay attention to the situation of textile enterprises receiving orders. </p
