According to the Commodity Market Analysis System of Business Society, the domestic PTA market has been fluctuating and declining since January. As of January 15th, the market price in East China was 5753 yuan/ton, a decrease of 2.98% compared to the beginning of the month. PTA supply is sufficient, dragging down prices. In addition, international crude oil has high volatility, but overall it shows a downward trend, which weakens the support for PTA costs.
In the crude oil market, the disturbance in the Middle East continues, and the situation is not clear. There is no sign of cooling in the short term, and oil prices still receive significant support. However, the US oil inventory has accumulated, and the market is once again concerned about economic weakness, which has significantly dragged down oil prices. Therefore, under the long short game, crude oil prices are mainly volatile. As of January 12th, the settlement price of the main contract for WTI crude oil futures in the United States was $72.68 per barrel, and the settlement price of the main contract for Brent crude oil futures was $78.29 per barrel.
Since January, from the perspective of PTA supply side, the production capacity operating rate has remained stable with little change, and the industry operating rate has remained around 82%. The pressure of sufficient supply of goods still exists. Among them, the 2 million tons/year installation of Yisheng Hainan will be inspected on December 25, 2023, and will be restarted to increase the load around January 15, 2024, or to increase the pressure of PTA supply.
The downstream polyester operating load is around 84%, and there are currently no plans for maintenance or restart of other large-scale polyester plants. The polyester factory has entered the annual maintenance phase, and production will slowly decline. Currently, as the Spring Festival maintenance period approaches, the load will further decrease. Although terminal demand has significantly weakened, there has not been a large-scale shutdown in the downstream. Currently, the comprehensive production of weaving machines in Jiangsu and Zhejiang is around 70%, and there has been no significant decline. Some enterprises may purchase raw materials at low prices in stages.
According to analysts from Business Society, the PTA market has recently declined, and the enthusiasm of polyester factories to replenish goods has increased compared to the previous period. The strengthening of short-term support for PTA demand may improve the pressure on sufficient supply of PTA goods. But considering that the Spring Festival is approaching, most downstream factories will be shut down for a month and a half, and demand is expected to weaken. In the crude oil market, the situation in the Middle East is still turbulent and there is no sign of cooling in the short term, which may continue to fluctuate. Therefore, overall, PTA will experience a short-term warming adjustment, and prices will also weaken in the future as demand drags down.
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