At present, the supply and demand side of PTA is still weak. The gradual recovery of crude oil and PX prices will provide certain cost support for PTA. However, PTA inventory is at a high level and there is great pressure to destock. Overall, there is limited room for PTA price increases in June.
Supply will remain relatively high
The PTA futures market in May is generally strong. On the one hand, after the May Day holiday, Saudi Arabia promised to further reduce production by 1 million barrels per day in June, and Kuwait and the United Arab Emirates also committed to additional production cuts of a total of 180,000 barrels per day. After the news was announced, the market believed that it would encourage other OPEC+ oil-producing countries to comply with production reduction regulations or even increase voluntary production reductions, which would help speed up the restoration of balance in the global oil market. Crude oil prices rose rapidly, and PTA prices strengthened under the support of rising crude oil. On the other hand, although the PTA market continues to be overstocked, two units in Jiangyin Hanbang were unexpectedly shut down one after another, and the supply was reduced, which provided certain support for PTA prices. Therefore, PTA prices increased in May. The closing price of the main 2009 contract on May 29 was 3,602 yuan/ton, an increase of 24 yuan/ton from the opening price of 3,578 yuan/ton on May 6; the benchmark spot price in East China on May 29 was 3,505 yuan/ton, an increase of 24 yuan/ton from the opening price on May 6. 3325 yuan/ton, an increase of 180 yuan/ton.
In May, the average operating rate of domestic PTA was around 90%, and the monthly output was around 4.15 million tons. At present, the maintenance status of PTA equipment in June is not clear, and there is still uncertainty about the implementation of Xinjiang Zhongtai Energy Investment. In particular, we must continue to pay attention to the maintenance status of major equipment, such as the maintenance of Yisheng and Tongkun units. Under the current circumstances of good profits, the overall domestic load will remain at around 90% in June, and PTA supply will continue to remain high.
Polyester demand may remain stable
Recently, affected by the rise in crude oil prices, the polyester market atmosphere has also improved. The prices and production and sales of polyester products have also improved. There have been varying degrees of increases and volumes, and the overall inventory pressure on polyester factories is not great. At the same time, three new polyester units were put into operation in May, with a total production capacity of 280,000 tons. The expansion of polyester production capacity has a positive impact on PTA prices. The polyester unit is operating solidly at relatively optimistic levels for inventories.
In June, there are expectations for the restart of the equipment that was previously inspected, such as Hengli, Rongsheng, Wuliangye, Anyang Chemical, etc. plan to restart in June, plus Shenghong’s 250,000 tons/year and Yisheng’s 500,000 tons/year. It is expected that new equipment will be put into operation in 2020, and the supply of polyester will further increase.
However, polyester factories may maintain production stability given the low inventory of finished goods and relatively abundant cash flow in the polyester market.
In short, the rebound in crude oil and PX prices has provided certain support for PTA prices. However, the current PTA inventory is still at a high level, and the pressure to destock is high. Added to the long-term accumulation of supply and demand contradictions in the industry chain, there is room for PTA prices to rise in June. limited. </p