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Limited supply reduction in August, PTA mainly consolidates within narrow range

Recently, there have been many changes in PTA equipment, but if there are no additional equipment maintenance or unexpected temporary shutdowns, it will still be difficult to destock PTA in August. The market i…

Recently, there have been many changes in PTA equipment, but if there are no additional equipment maintenance or unexpected temporary shutdowns, it will still be difficult to destock PTA in August. The market is likely to continue the light atmosphere in July, with mainly narrow range oscillations.

The supply reduction in August is limited

In August, some equipment that has not been inspected during the year has been shut down for maintenance, including Taihua, Reignwood, Sanfangxiang, Yangzi Petrochemical, etc. At the same time, Jiaxing Petrochemical Phase II, which was shut down in the early stage, has gradually increased its load and resumed operation. Hengli’s 5# unit, which was launched on July 11, will also be fully operational in August.

The PTA processing gap continues to remain around 650 yuan/ton, and the maintenance of Yisheng, Hengli and other equipment may continue to be postponed. Therefore, if there are no other accidents, PTA output in August will most likely continue to remain at 4.2 million tons. Up and down, basically the same as July.

Polyester load may stabilize

At the end of July, under the pressure of high product inventory, polyester filament and staple fiber factories released production cuts and increased prices. In response to price expectations, while increasing efforts in promotions, coupled with factors such as sporadic increases in terminal textile orders and month-end replenishment, the production and sales of polyester filament and staple fibers have experienced a surge in volume, and the inventory of polyester products has been significantly reduced.

However, judging from the operating rates of weaving and texturing in various places, gray cloth trading volume, gray cloth inventory and other data, the actual increase in demand for textile clothing is limited. The demand for polyester has increased this round, and more of it is for weaving and texturing. Regular replenishment, so the continuity and speculation of production and sales are difficult to say optimistically.

Moreover, even if polyester factories raise prices after inventory declines, based on current polyester raw material cost accounting, mainstream filament products are still at a loss on paper, which is a factor that can support the polyester load. , it may only be that the absolute price of upstream products is at a historical low, as well as the expectation of the peak season. Based on the data of previous years, the seasonal increase in demand began in late August. Before then, product inventory accumulation was relatively limited, and the polyester load may stabilize.

Crude oil prices oscillated strongly

OPEC+ entered the second stage of production reduction in August. However, in the early stage, Saudi Arabia and other countries stated that although they would increase production, they would control exports. On August 6, Iraq stated that it would reduce production by an additional 400,000 barrels per day in August to make up for its earlier non-compliance with the OPEC+ agreement. U.S. crude oil production has remained around 11 million barrels per day for many consecutive weeks, indicating that U.S. shale oil companies are not very motivated to increase production under current oil prices.

In terms of demand, the manufacturing industries of the world’s major economies are currently recovering well, which continues to boost crude oil demand. China’s manufacturing PMI in July was 51.1, an increase of 0.2 from the previous month; the ISM manufacturing PMI of the United States in July was 54.2, an increase of 1.6 from the previous month; the Markit manufacturing PMI of the Eurozone was 51.1 in July. From the perspective of micro data, weekly data on refinery operations in China and the United States have continued to rise steadily, and EIA data shows that U.S. crude oil and refined product inventories continue to decline.

On the whole, crude oil fundamentals continue to improve, and price oscillations are relatively strong.

Option trading is relatively active

The average daily trading volume of PTA options in July was 35,574 contracts, with trading activity increasing significantly and approaching the level at the end of last year. As of August 6, PTA option holdings were 61,894 lots, and the sell-to-purchase ratio of positions was 0.65. The market sentiment was mainly stable and cautious.

From the perspective of changes in positions and IV, during the process of moving positions to different months, the 4,000 yuan/ton, 4,300 yuan/ton and 5,000 yuan/ton subscriptions for the 2101 contract increased significantly, while the IV fell slightly. Put options concentrated on increasing positions at 3,400 yuan/ton, 3,550 yuan/ton and 3,600 yuan/ton, and IV also fell significantly. It shows that the enthusiasm of option sellers is higher than that of buyers, and judging from the market tendency, the first resistance and support levels of the 2101 contract are respectively 4,000 yuan/ton and 3,600 yuan/ton.

In terms of volatility, the average HV of the PTA January contract in the past three years from July to November is 16.56, the 25% quantile is 10.79, the 50% quantile is 14.91, and the 75% quantile The number is 20.93. As of August 6, the latest HV is 14.59, which has continued to fall back from the historical high to the historical middle. The IV has also fallen following the HV, and is now back to around 20, which is at the 30% quantile level since the listing. In view of the little change in the supply and demand side of PTA in August and the strong oscillation of crude oil, the cautious sentiment in the PTA market continues, and IV may continue to maintain a downward trend. </p

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Author: clsrich

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