During the May Day holiday, international crude oil prices continued to rise. Stimulated by rising costs, PTA rebounded slightly after the holiday. Although there is good support from the cost side, we should not be overly optimistic about the growth of PTA due to supply and demand constraints.
From a cost perspective, the loosening of city blockade measures in European and American countries has ignited optimism in the crude oil market. The OPEC+ production reduction agreement has been implemented since May 1st, which has boosted oil prices. Since Labor Day, Brent crude oil futures and US crude oil futures have both risen for two consecutive weeks. With the support of favorable costs, PTA has less room to fall, maintaining Shock pattern.
Data source: Jin Lianchuang
From the supply side Recently, Ningbo Liwan’s 700,000-ton PTA unit was shut down due to a fire accident in the refining unit; Jiangyin Hanbang’s 600,000-ton PTA unit was running at reduced load for some reason, and a maintenance plan may be introduced later. Shanghai Petrochemical’s 400,000-ton unit, which was originally scheduled to be shut down for maintenance on May 6, has now been postponed to May 16. The overall situation of the unit has not changed much, and the operating rate has stabilized at 84%. The oversupply situation is likely to remain for a long time. .
Data source: Jin Lianchuang
From the demand side , although polyester production has been relatively stable after the holidays, due to sufficient early stocking, the enthusiasm to continue stocking after the holiday is low, so there is no significant improvement on the demand side. In terms of terminals, affected by factors such as overseas epidemics and the Sino-US trade war, uncertainty in terminal demand has increased. Textile export orders are still scarce. Further recovery of terminal demand will have to wait for the arrival of an inflection point in foreign epidemics.
Data source: Jin Lianchuang
Taken together, although PTA has shown a slight rebound trend after the holidays, and the crude oil market is also relatively optimistic. However, the pattern of oversupply and no significant improvement on the demand side has not been reversed. Supply and demand constraints have suppressed market prices, the uncertainty of terminal demand has become prominent, and positive factors have not dominated the market. The path for rising PTA prices is not optimistic. </p
