According to the price monitoring of business clubs, the spot price of PTA has been falling since mid-September, and the domestic spot market price has gone from 10,600 yuan/ton to the current 8,200 yuan/ton, a drop of up to about 22.64%. Several major domestic companies such as Far East Petrochemical, Xianglu Petrochemical and Yisheng Petrochemical all lowered their November listing prices from RMB 9750/ton to RMB 9,000/ton this week.
Xia Ting, a PTA analyst at Business Club, believes that the current dismal PTA is mainly affected by the decline in the upstream PX market and the unfavorable downstream demand. In mid-September, PTA’s cost support began to weaken as the speculation in the upstream PX theme gradually receded. At the same time, weak downstream demand is the most critical factor that restricts the PTA market. At present, the overall operating rate of domestic PTA plants is maintained at a level close to full capacity, domestic production remains stable, and PTA supply steadily rises, but the demand is gradually shrinking. Since mid-September, due to the weak demand for textile terminals, the orders for surface and lining materials have been unsatisfactory, and the operating rate of looms has been low. As a result, polyester manufacturers have been hit hard by sellers and the market has been falling. At present, the level of production and sales of polyester companies is only hovering around 60-70%. Individual polyester manufacturers even have only 30-40%, and the rising trend of inventory is obvious. Regardless of the apparent panic in the Polyester market or corporate mentality, it is expected that the weak trend will continue.
Xia Ting believes that the lack of demand cannot be changed in a short period of time. In the short term, PTA will remain weak. In the medium and long term, it is expected that the state’s regulation of commodity price fluctuations will stabilize the market. Before the Spring Festival, the downstream buyers are worried about the post-holiday price increase. There may be a wave of purchases based on small and medium-sized singles. PTA prices will have a small range of recovery opportunities.
Xia Ting, a PTA analyst at Business Club, believes that the current dismal PTA is mainly affected by the decline in the upstream PX market and the unfavorable downstream demand. In mid-September, PTA’s cost support began to weaken as the speculation in the upstream PX theme gradually receded. At the same time, weak downstream demand is the most critical factor that restricts the PTA market. At present, the overall operating rate of domestic PTA plants is maintained at a level close to full capacity, domestic production remains stable, and PTA supply steadily rises, but the demand is gradually shrinking. Since mid-September, due to the weak demand for textile terminals, the orders for surface and lining materials have been unsatisfactory, and the operating rate of looms has been low. As a result, polyester manufacturers have been hit hard by sellers and the market has been falling. At present, the level of production and sales of polyester companies is only hovering around 60-70%. Individual polyester manufacturers even have only 30-40%, and the rising trend of inventory is obvious. Regardless of the apparent panic in the Polyester market or corporate mentality, it is expected that the weak trend will continue.
Xia Ting believes that the lack of demand cannot be changed in a short period of time. In the short term, PTA will remain weak. In the medium and long term, it is expected that the state’s regulation of commodity price fluctuations will stabilize the market. Before the Spring Festival, the downstream buyers are worried about the post-holiday price increase. There may be a wave of purchases based on small and medium-sized singles. PTA prices will have a small range of recovery opportunities.
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