There is still a lot of new production capacity in the fourth quarter, and there is still a certain amount of accumulation pressure in the PTA market; the demand for refined oil has cooled, and the support for PX from aromatics oil blending has gradually eased. Overall, PTA’s market outlook will continue to be under pressure.
After the National Day, PTA continued to oscillate weakly. On the one hand, it was due to the correction of high crude oil prices and weakened cost support; on the other hand, the supply and demand expectations in the fourth quarter were weak and there was greater pressure on new production capacity.
Cost support has weakened
In the past two years, geopolitics has caused fluctuations in oil prices and refined oil products, which has clearly supported the logic of regional oil blending. Especially during the peak summer travel period in the United States, the demand for refined oil products has boosted the demand for aromatic hydrocarbon blending. The United States and other countries shut down their disproportionation units and used MX for oil blending. PX from Japan and South Korea flowed to the United States, resulting in a decrease in PX production and a tightening of PX supply. After September, the logical support for oil adjustment should theoretically ease. However, it is understood that about 40,000 tons of PX still flowed from South Korea to the United States in September. It may be that the early export volume was delayed. The overall trend is towards cooling of demand for refined oil and aromatics adjustment. Oil’s support for PX eases in stages.
Recently, the disturbance of PTA equipment has increased, the equipment load is at a low level, and the supply has contracted. Judging from the PTA device load, the recent device load has dropped significantly, falling below 80% after the National Day. Hengli Petrochemical 2#2.2 million tons unit has been overhauled as planned. Sichuan Energy Investment’s 1 million tons production capacity is expected to restart in November. Ineos’s 1.1 million tons production capacity is planned to be overhauled in October. The load of Fuhai Chuang’s 4.5 million tons unit has been reduced from 70% to 50%. result, resulting in low installation load in the near future. At present, the 3.6 million tons unit of Yisheng New Materials has been restarted, and the unit load has rebounded. There were also units restarted in November, and the unit disturbance is short-term.
Since the beginning of this year, PTA output has continued to hit record highs, mainly due to the release of new production capacity. So far, PTA has added 7.5 million tons of new production capacity, mainly from Jiatong Energy’s 2.5 million tons and Hengli Huizhou’s 5 million tons, with a total production capacity of 78.94 million tons. In the fourth quarter of this year, there are still 2.5 million tons of Hainan Yisheng, 1.5 million tons of Taiwan Chemical, 3 million tons of Sinopec Yizheng, and 2.2 million tons of Hanbang. A total of 9.2 million tons of new production capacity are on the way. At present, Hainan Yisheng’s 2.5 million-ton unit and Hanbang’s 2.2-million-ton unit are expected to be released in November. If the units are released as expected, PTA supply pressure will still be high.
Polyester Load Gradual Repair
Recently, mainstream polyester companies in Xiaoshan have restarted, and the polyester load has been restored. Judging from the situation of polyester itself, with the decline of polyester raw materials, the cash flow of polyester has recovered. In addition, the current inventory pressure of polyester is not great. As of October 5, the inventory of filament companies was 17.8 days. Although the inventory was accumulated during the National Day holiday, the inventory is still at a low level. Therefore, the cash flow and inventory pressure of polyester itself is not great. This It also provides certain support for polyester companies to increase their load. However, it should be noted that as bottle flake production is reduced and discontinued, the polyester load may also be under pressure. Judging from the start-up of looms in Jiangsu and Zhejiang, the start-up of looms fell back to 75% before the National Day. In the later period, we need to pay attention to changes in terminal demand.
Since August, PTA inventory has continued to rise slightly and is in a state of accumulation. Although polyester load is at a high level, export volume has declined, PTA supply pressure has increased, and PTA is in a state of accumulated inventory. The short-term disturbance of PTA equipment increased, and the polyester load rebounded slightly. Overall, there is still a lot of new production capacity in the fourth quarter, and there is still a certain amount of accumulation pressure on the PTA market.
Based on the above analysis, although the short-term supply and demand of PTA has slightly improved, crude oil is under pressure at high levels, the logical support of aromatics oil adjustment has eased, PX is facing high valuation pressure, and the support for PTA from the cost side has weakened. Looking forward to the fourth quarter, the equipment is expected to restart in November, the equipment load disturbance has weakened, and PTA still has a lot of new production capacity to be launched. Although the new production capacity may be delayed, the pressure on new production capacity is self-evident. Therefore, supply and demand are more obviously suppressed by the PTA, and cost-side support has generally weakened. The market outlook is focused on changes in the Palestinian-Israeli conflict situation.
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