According to the Commodity Market Analysis System of Business Society, the domestic PTA spot market fluctuated and rose this week (May 20-25). As of May 25, the average market price in East China was 5946 yuan/ton, an increase of 0.52% compared to the beginning of the week.
| Gamma-PGA (gamma polyglutamic acid) |
There have been many changes in domestic PTA equipment this week, with Dongying United’s 2.5 million ton PTA equipment undergoing maintenance for about 40 days on May 6th. The 3.3 million ton device of Yisheng New Materials will undergo maintenance for about 20 days on May 16th. The Ningbo Taihua 1.5 million ton plant was shut down for one month on May 23rd. The 1.25 million ton PTA plant of Ineos located in Zhuhai has been temporarily shut down for 4 days since May 20th and resumed operation over the weekend. At present, the PTA operating rate in the industry is around 75%, and there will be no equipment changes next week.
At the beginning of the week, due to the expected improvement in oil demand and the decrease in US crude oil inventories, the geopolitical situation was tense, and multiple factors drove up international oil prices, which boosted the PTA market. However, due to the possible postponement of interest rate cuts and unexpected increase in US oil inventories as shown in Federal Reserve minutes, oil prices have been adjusted downwards for multiple trading days. As of May 23, the settlement price of the main contract for WTI crude oil futures in the United States was $76.87 per barrel, and the settlement price of the main contract for Brent crude oil futures was $81.36 per barrel, with WTI crude oil falling to a nearly three-month low.
In the PX market, the 550000 ton PX plant in Malaysia restarted earlier this week and was shut down due to a malfunction on May 9th. At the same time, Saudi Arabia’s 1.34 million ton PX plant also experienced an unexpected shutdown due to unstable operation and low load operation. Since May, due to frequent unexpected shutdowns of the equipment, the supply pressure has been alleviated.
Downstream mainstream polyester factories are gradually reducing production, with a strong intention to support the market and appropriate replenishment of raw materials. Under the seasonal off-season at the terminal, downstream buying intentions remain limited. With the approaching summer weather turning hot, the decline in polyester production has become a major trend, weakening the demand for PTA, PTA has accumulated inventory expectations. The decrease in demand will strengthen the impact of PTA oversupply and create a negative impact on PTA prices.
Business Society analysts believe that with the decline in crude oil prices, support for PTA costs will weaken, and downstream polyester factories are more likely to reduce production, leading to a decrease in demand for PTA. At the same time, it is still necessary to pay attention to whether there is an increase in unplanned maintenance of PTA devices under low processing costs. Overall, there is currently no bullish news on the fundamentals, The possibility of PTA price decline is high.
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