WTI crude oil surged 47% during the May Day holiday. After May Day, PTA and downstream polyester rose and transactions were once heavy. However, the textile market at the end of the industrial chain remained flat, which was very similar to PTA in early April amid expectations of crude oil production cuts. and the short-term rebound in the polyester market.
The most serious imbalance between supply and demand has passed, and the epidemic will still suppress the rebound.
Unlike the production cuts of major oil-producing countries in early April, which promoted the rebound of crude oil, the main reason for the sharp rebound of crude oil in early May was investment. Investors’ expectations for a recovery in crude oil demand in the future have increased. Some European and American countries have begun partial resumption of work and markets, and Trump also intends to “restart” the United States. As the world’s major economies, if the European and American economies can begin to recover, demand for crude oil will increase significantly, directly pushing up crude oil prices.
From a domestic economic perspective, the number of travelers and tourism revenue during the May Day holiday dropped by 40% and 60% respectively year-on-year. This is a good answer, and many shopping malls are also full of people. This reflects that under the normalized epidemic prevention situation, the domestic consumer service industry is in the process of slow recovery, so “economic recovery” has become the key word of the holiday. Judging from the reopening of economies around the world, we have reason to believe that the most serious imbalance between supply and demand has passed, and the market can be described as cautiously optimistic.
However, at present, the epidemic in Europe and the United States is still at its peak stage, and there is great resistance to economic recovery. On May 6, countries with insufficient testing capabilities, such as Russia, India, and Brazil, saw a significant increase in the number of new confirmed cases. It is believed that the peak stage of the global epidemic will continue, and the epidemic will suppress the rebound of crude oil.
Weaving is “polarized” during slow peak seasons: hot protective fabrics drive the “sudden rise” of FDY
On April 7, terminal looms started operating at about 57%, and on May 7, terminal looms started operating at about 50%. It is an indisputable fact that terminal looms have continued to be sluggish, which directly reflects the slowdown in the textile market during the peak season. dilemma. The European and American markets have been shut down, my country’s textile and clothing exports have stagnated, and domestic sales have weakened.
But unlike April, due to the global health security incident is still spreading, foreign textiles and clothing are also affected by it. The industrial load operation is limited, and the production capacity of protective fabrics and clothing is mostly concentrated in China. Therefore, the demand for production of melt-blown non-woven fabrics as the main fabric has been extremely hot recently.
At the same time, some companies and factories are actively reducing costs to develop new fabrics while ensuring medical protection functions. Recently, most textile companies have adopted “bulk goods” such as polyester taffeta and pongee. Common products are coated with PP and PE to produce medical protective clothing products, which can reduce costs and increase comfort while retaining medical protective functions as much as possible, but the durability rate is relatively low.
Among them, 190 pongee and 210 polyester taffeta are the main raw material fabrics. The production of 190 pongee is mainly concentrated on water-jet looms in Shengze area. Affected by this, Shengze has recently The operating rate and orders of regional water-jet looms are acceptable, and the load of some factories has been increased. Fabric orders in places such as Haining, Changshu, Changxing, Fujian Youxi and Quanzhou are still light. Similarly, the demand for polyester filament products also shows great differentiation and unity. In the past week, the average production and sales of polyester filament POY and DTY have basically maintained at 30-50%, while polyester filament FDY has “suddenly emerged” due to specific demand. In the past week, the average market production and sales have been above 130%. At the same time, as a guarantee of demand for substitutes, the price of fabric pongee and raw material polyester FDY has also rebounded.
“Retaliatory” orders may be difficult to meet expectations, and the polyester industry must rely on it to reverse the “war situation”!
In the future, terminal textile and clothing orders, especially export trade orders, will still be an important opportunity to reverse the “war situation” of the polyester industry, and the health and safety of countries in Europe, America, Africa, and Southeast Asia will The situation of incident control directly determines the progress of the company’s resumption of work and consumption recovery, which in turn directly affects its import and export trade.
As of the end of April, news shows that companies in some European countries have pressed the “acceleration button” in resuming work. Most local companies and ports have gradually resumed operations since May. As an important textile and clothing consumption region in the world, Europe, an emerging textile and clothing industry area – the spread of health and safety incidents in Southeast Asian countries, will have a phased tendency to re-flow textile and clothing trade orders into the country in the future, thus affecting the domestic chemical fiber clothing raw materials polyester and polyester filament. Demand is boosted.
However, we still need to be cautious. Partial resumption of work, lifting of port blockades, resumption of free trade, and recovery of residents’ consumption in various countries is not a fast process. At the same time, it is almost May, and production has From a cyclical perspective, future textile fabric orders will be dominated by autumn final orders and winter orders. Considering that domestic and even global consumption may be “retaliatory” in the second half of the year, which is expected, service companies above designated size will also be cautious in placing orders for production. In the economy In the context of the downturn, the pressure on clothing inventory should be controlled as much as possible.
Terminal textile and apparel export trade is an important opportunity to reverse the “war situation” of the polyester industry, and crude oil is undoubtedly the future of the polyester industry.”War situation” weather vane.
Unlike the terminal textile and apparel export trade, which may bring relatively obvious positive expectations to polyester in the future, crude oil in May is not entirely optimistic. 5 Global crude oil inventories will continue to increase in May. Even with some uncertain production reduction expectations, concerns about global crude oil storage in May are more prominent than in April. Although the current negative news in the crude oil market has almost been fully realized, there will be a lack of negative news in the future, but there are corresponding positive expectations. Not enough; from a fundamental point of view, crude oil is still expected to continue its “darkest moment” in May. As crude oil is the source product of the entire polyester industry chain, polyester filament and other polyester products will also be difficult to “live alone” .
Therefore, on the whole, the polyester and even polyester filament market in May has good expectations on the demand side, but there are also greater negative risks on the cost side. , under the coexistence of opportunities and crises, polyester factories still need to flexibly regulate sales strategies and reasonably control inventory to provide a looser operating space under the supply and demand pattern in the uncertain future stage.</p
