SunSirs: How Will PTA Be Interpreted in 2025-I?

Looking ahead to 2025:

In terms of production capacity:

PTA added 1.5 million tons of production capacity to Ningbo Taihua, 3 million tons to Yizheng Chemical Fiber, and 3 million tons to Dushan Energy in 2024, totaling 7.5 million tons. By the end of 2024, the total PTA production capacity reached 86.02 million tons, with a capacity growth rate of 6.7%. At the same time as adding new production capacity, the process of phasing out outdated production capacity has begun. Some new facilities had stronger cost competitiveness, and some old small-scale long-term shutdown facilities have been phased out. The centralized operation of large-scale PTA plants have promoted the survival of the fittest in the industry, and competition will become increasingly fierce.

It is expected that the PTA production capacity will increase by 8.7 million tons in 2025, with a capacity growth rate of 9.9%, and the pressure of growth will be greater than in 2024. Among them, Honggang Petrochemical and Hailun Petrochemical will be put into operation in the first half of the year, while Dushan Energy will be put into operation approaching the end of the year.

From the perspective of output

In 2024, the domestic PTA production was 71.8 million tons, an increase of 7.58 million tons compared to 2023, with a production growth rate of 11.8%, higher than the capacity growth rate, mainly due to the improved utilization rate of PTA capacity in 2024. Thanks to the high downstream polyester production, the annual industry average operating rate of PTA was around 82%. The equipment that will be put into operation at the end of 2024 will release production from early next year, and it is expected that the pressure of supply increment will continue to increase in 2025.

From the inventory perspective

The PTA inventory in 2024 was significantly higher than in recent years. During the downstream polyester off-season in the first quarter, PTA continued to accumulate inventory. The maintenance season in the second quarter was approaching to alleviate the pressure of accumulated inventory. However, with the restart of equipment and the sluggish polyester peak season, PTA has entered the accumulation stage again. It is expected that by 2025, due to the pressure of PTA production and high operating rates, the pattern of accumulated inventory is likely to be maintained.

From the perspective of exports

PTA exports performed well in 2024, with an estimated annual export of around 4.5 million tons, a year-on-year increase of approximately 1 million tons. Mainly due to the growth of exports in Southeast Asia and the Middle East, such as India's temporary relaxation of BIS certification control in the third quarter of 2024 due to PTA shortage, the export volume surged in July and September, contributing approximately 200,000 tons. At present, China's exports to Southeast Asia and the Middle East are still increasing to a certain extent, but Türkiye and India have plans to put devices into production in 2025, and the export volume is expected to decline.

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