As the Spring Festival holiday approaches, the polyester filament market is gradually entering its final stage. However, tensions between Iran and the United States have pushed oil prices to continue to rise, and chemical products have also been raised accordingly. Under cost pressure, the polyester filament market turned against the wind, with both market volume and price rising after New Year’s Day. However, as the geopolitical crisis eases, oil prices fall accordingly. After the black swan incident, the polyester filament market has also entered a period of low inventory and low demand. Currently, market participants are optimistic that expectations will increase, and the market may maintain a stalemate before the holiday.
Geopolitical situations have had a greater impact on commodities over the years. In September 2019, Saudi oil production facilities were attacked, crude oil prices soared, and oil processing profit margins in Asia have fallen to the lowest in more than a decade. level, the prices of polyester raw materials PTA and ethylene glycol have also increased accordingly. The cost pressure of polyester filament has become more prominent, and both volume and price have risen. However, overall, the increase in polyester yarn is much smaller than the increase in raw materials, and cash flow continues to narrow.
At the beginning of 2020, an Iranian general was attacked, Iran-US relations entered a deadlock, Iran launched an attack, oil prices continued to rise, polyester raw materials also increased accordingly, and the overall daily production and sales of polyester filament It is around 200%, and individual high-end prices are at 800%-1000%.
However, after polyester filament companies made up for the increase the next day, production and sales fell back to around 40%. As the tension between Iran and the United States eases, the raw material PTA weakens and ethylene glycol continues to open higher, but the support from the cost end of polyester filament has weakened significantly. Specifically, Hengli PTA equipment has been put into production recently, and finished products are expected to be produced in the middle of the year. In the short term, the release of new production capacity will have a negative impact on PTA.
In terms of ethylene glycol, low inventory is the focus of the tug-of-war between bulls and shorts, which may drive a recovery in ethylene glycol futures prices in the short term. However, the current ship pollution incident and route diversion news have further pushed up prices. Therefore, in the short term, the spot trend of ethylene glycol futures is expected to be bullish, but in the long term, emergencies will have limited impact on ethylene glycol.
Although the industry start-up at the end of 2019 was slightly higher than the level in 2018, corporate inventory levels remained low, black swan events occurred frequently at the end of the year, and there were many variables in raw materials, so some polyester Filament companies believe that the market maintained stable operation before the year, breaking the destocking model of price reduction promotions before the Spring Festival in previous years.
At present, most of the maintenance equipment have been restarted in February, and some equipment will still undergo power upgrades or process upgrades in the later period. Therefore, the start-up of polyester filament after the holiday is slow, and the current inventory level is low, so the holiday It is expected to rise slightly later. However, according to feedback from some industry insiders, due to concerns about the rising polyester filament market after the holiday, some downstream users have stocked up in advance, which means that post-holiday demand has been exceeded in advance, making it more difficult to raise prices after the holiday. </p
