Price trend

According to the Commodity Market Analysis System of SunSirs, PTA prices experienced a significant decline in September. As of September 8th, the average spot price of PTA in East China was 5,012 RMB/ton, a decrease of 6.89% from the beginning of the month. International crude oil prices had experienced a wide decline, and PTA cost support had collapsed. In addition, the company's operating rate remained high, but downstream demand was insufficient, and PTA still faced pressure to accumulate inventory. Under the combination of multiple negative factors, the PTA market continued to weaken. Specifically, let's take a look:

Analysis review

The PTA industry construction rate remained at a high level of around 83%. Among them, the 900,000 ton plant of Pengwei Petrochemical was shut down on August 31 and will not restart in the short term. The 1.2 million ton plant of Ningbo Taihua underwent maintenance on September 1. In the later stage, attention could be paid to the restart of the 2.5 million ton PTA plant in Northeast China and the maintenance status of the 2.2 million ton PTA plant in Northeast China. Overall, recent changes in equipment had been limited, and PTA supply remained abundant.

The crude oil market had fluctuated and weakened. As of September 6th, the settlement price of the main contract for WTI crude oil futures in the United States was 67.67 US dollars per barrel, and the settlement price of the main contract for Brent crude oil futures was 71.06 US dollars per barrel. As of September 6th, there was a strong expectation for OPEC to increase production in October according to the plan, which weakens the impact of recent crude oil production cuts in Libya and other countries. In addition, the summer peak season for gasoline and diesel consumption had ended, and supply and demand had weakened. The crude oil market lacked positive expectations, and prices were under pressure and declining. Although geopolitical risks still existed, the market's main focus was on fundamentals.

The cost side of the PX market was weaker, and in terms of supply, the maintenance of the 1 million ton unit of Dongying Weilian and the 2 million ton unit of Zhejiang Petrochemical in China had gradually led to a narrow decrease in PX operating load. The demand side performance was stable, and PX was in a slight destocking cycle, but the market lacked confidence in the future, and the atmosphere of supply and demand fundamentals game was obvious.

There was no significant expectation of improvement in terminal textile demand, and only some autumn and winter fabric orders may increase. The procurement of raw materials maintained the necessary operations. The polyester industry was operating at around 85%, and the market was waiting for the downstream peak season to turn. It is expected that polyester production may slightly increase, and the demand for PTA will also slightly rebound.

Market outlook

SunSirs’ analysts believe that PTA supply was sufficient and there was temporarily no possibility of a significant decrease in supply in the short term, which could negatively impact market sentiment due to inventory accumulation. Downstream transactions were sluggish, and procurement wa mainly focused on consuming inventory, with a cautious wait-and-see approach. The bearish fundamentals were suppressing, and it is expected that PTA prices will continue to operate to be weaker in the short term.

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