Weak fundamentals and insufficient motivation for the continuous rise of PTA prices

According to the price monitoring of business agency, the domestic PTA market rose slightly on January 26. The average market price in East China was 5322 yuan / ton, up 0.68% from the previous trading day and 39.77% year-on-year. PTA futures 2205 closed at 5410, up 156, or 2.97%.


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In terms of supply, with the recent restart of multiple units, the industrial commencement has increased to more than 86%. The 3.3 million ton new unit of Yisheng new materials is planned to be commissioned at the end of January, and the PTA supply is expected to increase. However, two sets of PTA units in East China announced maintenance plans, which significantly boosted the market. Among them, Yisheng Ningbo 2 million ton PTA unit is planned to be overhauled in February; The 3.3 million T / a PTA plant of Yisheng new material is planned to be overhauled in February.


In addition, oil prices rebounded strongly on January 25, and WTI rose significantly, nearly 3%. The settlement price of the main contract of WTI crude oil futures in the United States was US $85.60/barrel, up US $2.29 or 2.8%, and the settlement price of the main contract of Brent crude oil futures was US $88.20/barrel, up US $1.93 or 2.2%. The main reason is that the supply side risk has boosted the oil price, the tension in Ukraine and Russia, the previous attack on the United Arab Emirates, the current risk has not been lifted, and it is difficult for OPEC to increase production.


With the arrival of the long Spring Festival holiday and the holiday of the terminal textile factory, the current situation is that the procurement is stopped, the preparation before the festival is coming to an end, and the demand is declining. In the continuous shutdown of dyeing factories and weaving factories, the comprehensive startup rate of Jiangsu and Zhejiang looms has dropped to less than 13%, mainly focusing on the closing of early orders and being cautious in receiving new orders. At present, the idea of replenishing inventory is not strong and remains in a tepid state. The operating load of polyester factories in Jiangsu and Zhejiang decreased to less than 80%, the quotation remained stable, and some factories promoted individual specifications.


Business analysts believe that some PTA units are planned to be overhauled to offset the new capacity to be put into operation, and the rebound cost of crude oil is increased, so it supports the strength of PTA prices. In the short term, PTA prices are greatly affected by costs. As the Spring Festival approaches, the operating rate of downstream polyester plants will further decline, the fundamentals are weak, and PTA continues to rise with insufficient power.