Brief description of the first part
According to Jinlianchuang monitoring, PX upstream and downstream products plummeted across the board in March. The foreign pneumonia epidemic was fermenting. The OPEC+ meeting failed to reach any production reduction agreement and ended. Crude oil continued to hit new highs. In recent years, the new lows have not only been caused by weak cost performance, but also by the suppression of terminal demand by the epidemic. The export of polyester products has been restricted. PX and PTA have mainly accumulated inventories, increasing supply pressure, spreading pessimism among industry players, and the market has continued to fall.
Table PX and related products rise and fall rankings in March
Data source: Jin Lianchuang
This month, the average monthly price of PX upstream and downstream products showed an overall decrease month-on-month. The decline in upstream raw materials was relatively large. Among them, the monthly average price of PX decreased by 19.78% month-on-month. The monthly average price of isomerized xylene market decreased by 16.06% month-on-month. The monthly average price of PTA The price fell 14.98% month-on-month, and the average monthly price of downstream polyester chips fell 14.18% month-on-month. Although the polyester bottle flake market had the smallest month-on-month decline, it also fell by 9.71%.
Part 2: Market analysis of main products of the PX industry chain
Data source: Jin Lianchuang
Isomeric xylene
In March, the domestic xylene market experienced a historic plunge, which continued to refresh the market’s perception of low prices. Although the turning point of the domestic epidemic has arrived, demand has gradually recovered, and the fundamentals have shown a positive trend, but The new negative factors are more severe than the test of the domestic epidemic. OPEC and Russia have not reached an agreement on deepening the production reduction agreement. OPEC has lost its meaning. The conflict of oversupply of crude oil has become irreconcilable in the market state of shrinking demand. Major oil-producing countries have abandoned the agreement and instead competed for market share, causing crude oil prices to lose control. WTI Futures prices fell below US$30/barrel and then hit US$20/barrel, causing global chemical commodity prices to collapse. At the same time, the U.S. stock market has experienced circuit breakers four times in ten days, financial market turmoil has deepened panic, and the rapid spread of the epidemic in many European and American countries has made global demand and economic prospects pessimistic. The domestic xylene market continues to dive at low levels. By the end of the month, the price at the main port in East China fell to 3,100 yuan. / ton out of cans, lower than the historical low of 3,380 yuan / ton in 2003.
PX
The Asian PX market plummeted in March, and market prices continued to hit new lows in recent years. As of the end of the month, Asian PX was estimated at US$447/ton FOB South Korea and US$467/ton CFR Taiwan. /China, down $240/ton from the end of last month, a decrease of 33.95%. At the beginning of the month, the general environment was bearish and the atmosphere of the industrial chain was sluggish. Although crude oil rebounded from oversold, it soon continued to weaken. Affected by the domestic epidemic, terminal demand was sluggish. PX social inventory increased significantly compared with the Spring Festival. Merchants were cautious and PTA inventory It is also on the high side, and the downstream market is also on the weak side. The OPEC+ meeting failed to reach any production reduction agreement in the first half of the year and ended. International crude oil plummeted, and commodities were in trouble. PX could not escape the bad luck. On the 9th, Asian PX closed down by US$100/ton in a single day. The decline reached 14.6%. International crude oil continued to hit new lows this year, falling to the lowest level since 2002. Under the suppression of the weak general environment, PX followed the upstream market and fell sharply. In the second half of the year, the foreign epidemic was severe and the export of polyester products was blocked, which continued to put pressure on the market. In addition, Fuhaichuang’s 800,000 tons/year PX device has resumed and restarted, and the supply of PX has increased significantly. However, the downstream PTA operation is not high. Under the imbalance of supply and demand, PX continues to decline and bottom out. At the end of the month, Sinopec announced that the March PX settlement price was 4,760 yuan/ton, which was 1,340 yuan/ton lower than the previous month’s settlement. The average CFR Taiwan/China price in March was US$592.7/ton, down 19.78% month-on-month and 45.72% year-on-year. The lowest price was US$490/ton on March 26, and the highest price was US$711/ton on March 4. Ton.
PTA
The PTA spot market continued to fall in March, with prices hitting new lows repeatedly during the month. At the beginning of the month, the crude oil production reduction agreement was not reached, causing oil prices to plummet. The collapse of costs led to a weak decline in the PTA market. The spot price hit a record low, and the market had a strong wait-and-see sentiment. As crude oil continues to decline, PX has fallen sharply. Although the absolute price of PTA is low, processing fees have remained at a good level and factory shipments have been slightly positive. However, the impact of the epidemic on the economy is still obvious, especially the negative impact on foreign trade. , which in turn affects the downstream demand for PTA. Therefore, the market trend is still mainly weak. On the 12th, the spot offer at the main port in East China was reduced by 80-90 yuan/ton for the 2005 contract, and the offer was reduced by 100 yuan/ton. The negotiation centered on 3750-3770 yuan/ton. In the middle of the year, global panic surged, and the crude oil price war began. Oil prices fell off a cliff. Affected by this, the spot price of PTA market futures hit new lows repeatedly, and market trading sentiment was sluggish. Although some PTA companies have experienced equipment maintenance, their high inventory is still difficult to digest, and downstream polyester demand is slowly recovering. Coupled with sluggish orders in the textile industry and sluggish exports, the market lacks positive support, and PTA prices are weakly falling. On the 19th, the spot offer at the main port in East China was reduced by 80-90 yuan/ton for the 2005 contract, and the offer was reduced by 100 yuan/ton. The negotiation centered on 3350-3370 yuan/ton. In the second half of the year, crude oil continued to run at a low level and showed signs of gradually stabilizing, which boosted the PTA market. However, the spread of the global epidemic has adversely affected textile foreign trade, which in turn affects PTA terminal demand. On the 30th, the spot offer at the main port in East China was reduced by 75 yuan/ton for the 2005 contract, and the offer was reduced by 80-85 yuan/ton. The negotiation centered on 3040-3110 yuan/ton. The average PTA market price in East China in March was 3,660 yuan/ton, down 14.98% month-on-month and 44.22% year-on-year. The highest price appeared on the 4th at 4,240 yuan/ton.�The low price appeared at 3,040 yuan/ton on the 30th.
Polyester bottle chips
The focus of the polyester chip market declined in March, and the trading atmosphere on the market was acceptable. At the beginning of the month, the domestic COVID-19 epidemic control was gradually relaxed, downstream and terminal operations resumed in an orderly manner, the production and sales of the polyester chips market increased, and the focus of market transactions gradually stabilized. However, as the COVID-19 epidemic spreads around the world and under the influence of the plunge in international crude oil, the market for polyester raw materials PTA and ethylene glycol has fallen sharply, resulting in negative costs. Polyester chip factories have to cut prices to stimulate shipments, but downstream and terminal demand has weakened. , downstream chip spinning companies only maintain rigid purchases, the production and sales of the polyester chip market have become sluggish, and the focus of market transactions continues to decline. Towards the end of the month, downstream factories have tight cash flow and are cautious in continuing to stock up. Polyester chip factories have difficulty exchanging price for volume. The actual transactions are more than one, and the market decline gradually slows down. As of now, the average market price of polyester chips in East China this month is 5,098 yuan/ton, down 14.48% month-on-month and 34.87% year-on-year. The highest price was 5,750 yuan/ton on March 2, and the lowest price was 4,250 yuan/ton on the 31st. Yuan / ton.
Part 3 Forecast and Outlook
Jin Lianchuang predicts that the PX industry chain may continue to be weak in April. Although many products are already at their lowest levels in the past ten years, there seems to be little room for downside. , but it is still unknown when the global epidemic will end. PX and PTA destocking still needs to be processed, and there are many pressures on the industry chain. The following is the market outlook for the main products:
Xylene
In April, domestic xylene is expected to gradually establish a bottom, and the rationality of low prices will be recognized. With the low price of imported crude oil After entering the market, the cost pressure of refining and chemical companies will be greatly alleviated, and the operating rate is expected to increase. However, due to the impact of the epidemic, global demand has declined, gasoline exports, and terminal manufacturing product exports will all shrink. The increase in xylene supply will lead to a deepening of the fundamental contradiction between supply and demand. In the case of supply and demand imbalances, lower raw material costs mean lower price products. The epidemic and the battle for crude oil market share will be difficult to end within 1-2 months. Therefore, the domestic xylene market trend in April is still weak and has fallen below the historical low price. The room for continued decline may be very limited. , but it is difficult to get rid of the low price status.
PX
The foreign epidemic situation is still severe, the financial market is full of panic, and the industry’s risk aversion is strong. PX itself is also not optimistic. The PX equipment basically maintains normal operation. The overall supply is high, but end demand is still weak, and the export of polyester products is not smooth. However, considering that PX prices are already at a low level, the decline may slow down. It is expected that the Asian PX market will be weak and volatile in April.
PTA
It is expected that the PTA market may continue to be weak in April. Crude oil may remain in a low price range for a long time. After the large-scale domestic PX equipment was put into operation, the supply shortcomings were made up, the profits of PX-crude oil were greatly compressed, and the cost-side support was weak. The oversupply of PTA itself has become an industry consensus, and processing fees have been compressed close to the industry cost line. The current high PTA inventory is still beneficial to short sellers. Coupled with the falling costs, business operations still maintain a high level. However, the demand affected by the epidemic has caused People are pessimistic. Although the expansion of polyester production capacity is relatively limited, the industry situation is the most optimistic in the industry chain. However, the global economy is declining and the terminal textile market is pessimistic. Therefore, it is expected that the PTA market will not emerge from the weak trend in the short term.
Polyester PET
It is expected that the polyester chip market may be weak in April. From the perspective of supply and demand, the inventory pressure of polyester chip factories has eased in March, but the operating rate of the polyester chip industry has risen to a high level. It is expected that the supply pressure of the polyester chip market will still be high in April; the global new crown pneumonia epidemic has not yet been significantly controlled. However, the domestic end-use textile market will continue to recover, and it is expected that downstream demand in April will be generally average. From a cost perspective, the PTA market has not yet emerged from a weak trend in the short term. Another raw material, ethylene glycol, may begin to bottom out and stabilize in April, and the cost aspect may still be negative. Affected by this, the polyester chip market may still maintain a weak trend in April, but as companies continue to lose cash flow, the market decline may gradually slow down. </p
