Introduction: The COVID-19 epidemic has had varying degrees of impact on chemical products, and PTA, as one of the chemical products, has also seen surprising changes. The main contract opened at the limit on the first day in 2005 and ended with a drop. The spot price plummeted 8.96 percentage points compared with before the holiday. Although the downstream polyester production has gradually resumed as the epidemic has been effectively controlled, the market price of PTA still fluctuates at the bottom due to high inventory.
With the absolute price of PTA relatively low, the trend direction in the later period has become the focus of industry players. Then let us briefly analyze:
First of all, PTA processing fees remain in the range of 300-600 yuan/ton, and the market lacks support
Data source: Jin Lianchuang
In the recent stage, PTA processing fees have remained between 330-550 yuan/ton, the highest level in the past three years. At a low level, most devices have already fallen into losses. If compression continues, some factories may be forced to shut down. Therefore, it is unlikely that processing fees will continue to be compressed at this level. However, under the current situation of oversupply in the PTA industry, if the processing fee returns to above 650 yuan, some factories will first rush to the runway and actively ship goods or sell hedging orders. Therefore, it is expected that the processing fee will remain in the range of 300-600 yuan. time, if a transaction is made, it can be operated according to the processing fee range.
Secondly, downstream polyester and weaving factories have resumed operations, and high inventories have been digested
Data source: Jin Lianchuang
As the epidemic has been effectively controlled, some downstream polyester companies have resumed work one after another. At the end of February, the operating rate of polyester and weaving factories has increased significantly, and the demand for raw materials has also increased. There has been an increase, but some factories have stocked up before the holidays, and the negative impact of the recent decline in raw materials and their own high inventories has suppressed the market’s willingness to place orders. However, the early use of raw material reserves in weaving plants is coming to an end and the inventory replenishment cycle has entered. Polyester production and sales have gradually picked up, and the situation of high profits and inventory of polyester products has also been alleviated.
Data source: Jin Lianchuang
Although the transportation link is blocked, the polyester market is not trading The investment has very limited improvement in the current inventory pressure and sales pressure, but it can also alleviate the downward pressure on the polyester market, and the company’s theoretical cash flow performance is considerable; as companies gradually resume work and face high inventory, some factories have begun to cut prices and promote sales. , the cash flow of polyester products has begun to compress on March 9, and the high inventory of polyester products has also been digested to a certain extent.
In addition, the cost side also has a corresponding impact. The trading atmosphere in the PX market is average. The ACP negotiation failed this month, with the range being 640-820 US dollars/ton CFR Asia. Fuhaichuang and Hainan Refining and Chemical PX units plan to restart, and domestic supply will return to normal. Therefore, the support for PTA weakens.
At this stage, the Federal Reserve’s interest rate cuts will drive emerging market economies to stabilize, and commodity prices represented by crude oil will receive significant support. However, the recent OPEC meeting is still discussing whether to increase production cuts. Even if the production cuts are strengthened, the weakness on the demand side cannot support the mid- to long-term strength of crude oil.
Taken together, based on the logic of macro-expected resumption of work, PTA, whose absolute price is relatively low, has a certain degree of resilience. The increase in demand may become a weight for speculation, but PTA processing fees have rebounded. When the price exceeds 600, some factories will first seize the runway and actively ship goods or sell hedging orders, thus inhibiting the upside of PTA; foreign epidemics have caused global macro risks to continue to accumulate, and at the same time, we need to be wary of the negative effects of high inventory on the market; Therefore, the PTA market may continue to fluctuate at the bottom in the short term, and it is not recommended to buy the bottom in operation. </p
