Price trend

According to the Commodity Market Analysis System of SunSirs, after the end of the National Day holiday, the domestic polyester staple fiber market showed a surge and following a decline. As of October 17th, the average market price in East China was 7,385 RMB/ton, which was the same as the beginning of the month. The geopolitical situation has once again become tense, with international crude oil prices strengthening and the cost support of polyester short fibers rising. In addition, China announced a series of economic stimulus policies before the holiday, and the commodity market atmosphere was relatively warm. However, downstream terminal demand had shown average performance, and at the same time, the international crude oil market had fallen, leading to a decline in the price of polyester staple fibers.

Analysis review

On October 16th, the settlement price of the main contract for WTI crude oil futures in the United States was 70.39 US dollars per barrel, and the settlement price of the main contract for Brent crude oil futures was 74.22 US dollars per barrel. The significant decline in international crude oil prices weakened the cost support for PTA. As of October 17, geopolitical instability continues to affect the market. The traditional peak season in the United States has ended, and global economic data has performed poorly. OPEC has lowered its global oil demand forecast for the third consecutive month, raising concerns about the demand outlook.

PTA factory equipment has experienced frequent restarts after short-term shutdowns, and the current industry operating rate is around 88%. It will continue to operate at a high level in the near future, and the supply of goods remains abundant. In terms of price, as of October 17th, the average market price of PTA in East China was 4,887 RMB/ton, a decrease of 0.83% from the beginning of the month.

Due to the impact of cost decline and the lack of significant increase in terminal orders, the signal of peak season for yarn mills has not appeared, and they were purchasing short fibers or maintaining sporadic rigid demand purchases. Most of them adopted a wait-and-see attitude, and the focus of market transactions was weakening. It is expected that the consumption of raw materials purchased by terminal factories in the early stage will reach a low level by the end of October, and the expectation of replenishment for essential needs will to some extent support their prices.

Market outlook

SunSirs’ analysts believe that on the cost side, with the decline in international crude oil prices and limited maintenance of PTA facilities in recent times, the overall market supply was sufficient, and the focus of cost support had shifted downwards. The terminal maintained normal production, consumed more raw materials in the early stage of stocking, and had weak procurement follow-up. The fundamentals are weak and difficult to change in the short term, and the price of polyester staple fiber will continue to decline.

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