On December 7, PTA spot market was weak and cold

On December 7, the PTA spot market was weak and the market was cold

on Wednesday, the raw material market was cold. Due to the gains made by polyester factories in the contract goods market and the arrival goods of spot financiers increased one after another, the PTA spot price was under pressure again. From the perspective of PX price, despite the slight upward attack of Asian PX spot supported by strong crude oil, it is still lack of confidence. The arrival of 70000 tons of American PX spot in Hong Kong and the driving of Qingdao Lidong will have a direct impact on PX spot. It is reported that there will be 7.5% in November The shipment of 10000 tons of foreign goods reached 8.5 million tons in December 10000 tons. The start-up of Qingdao Lidong needs to increase at least a certain amount of supply. Therefore, it is conservatively estimated that the supply increment of PX in December is more than 100000 tons, which is enough to meet the increase of three new PTA units. On the contrary, if several sets of new PTA capacity are put into operation in November and December, it will further depress the PTA Market and foreign PTA manufacturers will fall back into a loss situation, which is likely to lead to a new round of PTA unit production reduction or shutdown, The weakening demand for PX raw materials will form a huge contrast with the increase in supply. Therefore, although the increase of new PTA plants may not aggravate the tension of PX raw materials, it may make the PX supply surplus. In addition, the weak market characteristics of terminal demand at the end of the year will become increasingly obvious, and all links will face the pressure of clearing the reservoir and capital

as the start-up of the new PTA plant is about to begin, it indicates that its PX material preparation has been completed. The PX contract of these newly started PTA plants must be guaranteed to a certain extent. The demand for PX generated by PTA start-up has increased, and the so-called benefits have been released in the early stage. For PTA plants with such a large demand for PX, it is obviously impractical to purchase a large amount of PX in the spot market. Most of them have established long-term contractual relations with PX suppliers or middle-sized agents. The increased supply of new PX plants such as Indonesia tppi 500000 tons, Yangzi Petrochemical 200000 tons and India oil 400000 tons can also meet the PX demand caused by the entry of these new PTA plants, In addition, China's Qingdao Lidong's 700000 ton huge PX device is driven, so it can be concluded that the driving of the new PTA device will inevitably hit the market, which may be unexpected to many people. In my opinion, the sharp rise in PX before August has digested the so-called tension of PX to a certain extent, and the untraceability of the change of PX device load is also the basis to break the so-called PX tension lie. Many market people previously believed that the PX shortage would have a strong effect on PTA and may become a bubble. Looking back on history, when BP's 1.1 million ton PX device was shut down for nearly a year last year, PX has no major shortage of supply and stable price. This year, after BP started driving, PX did not fall but rose. It can be seen from this that the sharp rise of crude oil and the components of speculation have greater factors affecting PX price. This year, even if PX price once rose to more than 1500 US dollars, it seems that no PTA factory has stopped production or reduced its burden because it did not purchase px, It can only be said that because the PX price is too high and the benefit is reduced, it is forced to reduce the load. From this perspective, the supply is constantly changing, and the elasticity is often unpredictable. From the current situation or the comparison with the previous period, the driving of Qingdao Lidong and the resumption of production of bp1.1 million ton PX plant in the United States will inevitably have an impact on the balance of PX supply, which is just a matter of time

from the analysis of import data, the total import volume of PX in China in October was 183100 tons, a decrease of 24500 tons compared with September, and the customs declaration price was 1372.34 US dollars/ton. For three consecutive months, China's PX import volume exceeded last year's average monthly import volume of 130000 tons. In the three months from, the average monthly import volume was about 180000 tons, which was about 50000 tons higher than last year's average import volume. It can be seen that the PX material preparation of China's PTA plant has started in August, and in addition, the expanded capacity of Yangzi Petrochemical and Liaohua petrochemical in China is 600000 tons/year. Therefore, the author can basically confirm that the material preparation of the new PTA plant is basically completed, and the recent concentration of PTA units also confirms that the PTA plant has sufficient PX inventory. Recently, two sets of new PTA units in Ningbo have been put into operation. If there is no accident, the sales of contract goods are already in full swing. Coupled with the supply of new PTA from Yangzi Petrochemical at the end of last month, the domestic PTA output in December is conservatively estimated to increase by about 120000 tons, or even to 150000 tons of full load. If the polyester factory only purchases enough, the external supply will be reduced by more than 100000 tons, In other words, the external supplier will increase the corresponding inventory. From this perspective, we can imagine the pressure of the external contract in December

from the negotiation progress of the contract price in December, we can also see the changes of suppliers' views and mentality on the future market. Although mainstream suppliers have successively introduced the December PTA contract quotation of 910 US dollars/ton CFR, this quotation is almost the same as that in November, but it is only a symbolic increase of 10 US dollars. From the supplier's attitude, they are not confident that the December contract opening price can be the hydraulic universal testing machine at the beginning of 900 US dollars/ton in October. Firstly, due to the high load of PTA devices at home and abroad, and the inventory, especially the domestic suppliers have a certain inventory, Therefore, the supply of PTA is obviously sufficient. Secondly, the spot price of PTA shows a downward trend. The current spot price is much lower than the contract price. Some low-quality source offers appear at 860 US dollars/ton CFR China for 90 days or even lower. The current spot price of PTA inside and outside is also much lower than the contract price. The contract acceptance of polyester factory is not very willing. Third, the settlement of the internal contract in November was only accepted and delivered in March at 8650 yuan/ton, which was much lower than the external contract of US $900 in November. The polyester factory also called for a review of the contract price in November. Fourth, the increase in PX supply is quite obvious. The future of the downstream is still uncertain, and the financial pressure at the end of the year will be much stronger than usual. Under the pressure of so many bad news, it is difficult for PTA suppliers to have the confidence to win and successfully exit the contract above $900. In terms of cost, whether PX is settled at US $1000, US $1050 or US $900, PTA contracts have considerable profit margins. Polyester factories will not easily give in when they take the initiative, and the competition for PTA contracts will still be fierce in December. Sure enough, the news from the contract PTA Market on Wednesday left spot traders and suppliers at a loss. After not insisting too much, in order to sell the contract goods in December before Christmas as soon as possible, the mainstream suppliers have retreated to US $880/ton CFR China 90 days to deal with the October February contract. Moreover, the response of polyester factories is still not very strong, and there are still a few polyester factories eager to open letters of credit, Compared with the contract execution of $900 in November, the contract performance enthusiasm of $880, which is cheaper in December, is not as enthusiastic as that of $900, which is higher in November/More frightening to the suppliers is the news that some suppliers sell December contract goods at the price of 860 US dollars/ton CFR China for 90 days, without any review factors. Obviously, the suppliers are quite pessimistic about the future market, otherwise they will not easily cash out the contract goods under the spot price level. Once such news comes out, Other suppliers have no confidence in whether the contract goods can be sold smoothly at the price of 880 US dollars, and the spot market will also be severely hit by the concession of the contract price. The PTA market is full of overcast winds and rainstorms

to sum up, since the problem of start-up and material preparation of new PTA units has been preliminarily solved, the market will only be affected by the start-up of two new PTA units, not by the shortage of PX. The impact of the simultaneous start-up of two PTA units on the PTA market is not like the start-up of a set of chip spinning or a set of new polyester. Based on the current PTA consumption of more than 1 million tons/month in China, Two new sets of PTA units are added every month, that is, 100000 tons of PTA supply is increased every month, which is equivalent to a sudden increase of 10% of PTA supply. This 100000 tons of PTA supply increment can meet the one-month material preparation of ten large polyester units. Imagine that under the current polyester production capacity, ten new sets of 180000 tons of polyester will be started within one month. What impact will it have on the polyester market, Then it may be inferred that at this time, the temperature controller on the left and the timer on the right will show what impact the start-up of two or three sets of PTA devices will have on the PTA market. Looking back on the start-up of two new units of Yadong and Hualian Sanxin in March and October this year, the spot price of two months showed a downward trend. From the perspective of contract settlement price, the settlement level of the internal contract was significantly lower than that of the external contract. The impact of the start-up of the new PTA unit on the spot price of raw materials and the contract goods price is beyond doubt. Based on the new output of 50000 tons/month of each unit, the entry of a new PTA unit is equivalent to a 5% increase in the production capacity of PTA, Moreover, since this increase is sudden and rapid, whether from the start-up of MEG Middle East device or the start-up of PTA new device, the price trend history has proved that as long as the new production capacity enters more than 5%, its impact on the market price must be negative, and sometimes the short energy generated will be quite terrible, which is the inevitable result of the iron law of market supply and demand

based on the demand for PX, the current monthly demand for PX in Asia is about 1.4 million tons, while the supply increment of PX in Asia in the past two months includes 80000 tons of North American foreign goods and 60000 tons/month of Qingdao Lidong. Obviously, the monthly supply increment of PX in Asia is likely to exceed or close to 10%, so it is very simple. If the demand for PX does not exceed 10% or the demand increment does not match the supply increment, the imbalance between supply and demand of PX is bound to appear. By analogy, if the supply increment of PTA is 5% and the supply increment of PX is 10%, but the demand for polyester does not increase, but shows a downward trend, the polyester load is declining slowly, the inventory of polyester products is increasing slowly, and the price of polyester products is depressed, then it is very simple, the digestion capacity of the terminal is declining, the upstream supply is increasing, and the imbalance between supply and demand is likely to intensify at the end of this year or at the beginning of this year. Generally speaking, if the polyester factory has more options for supermarkets in terms of raw material procurement, contract goods suppliers begin to compete with each other, and the spot demand is also squeezed by the entry of new PTA production capacity, then the subsequent price competition is inevitable

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