Downstream resumption is expected to gradually accelerate polyester raw material

This week PTA shock is strong. The impact of the new crown epidemic continued, and the terminal recovery was still slow. The fundamentals of PTA accumulation were weak, but there was little space for downward compression of processing costs, while the cost end crude oil increased significantly, PTA fluctuated in a narrow range. As of Friday's close, ta005, the main contract, rose 1.9% to 4556 CNY/ton, with weekly trading volume of 2076600 and positions of 743400. Ta009 rose 1.1% to 4586 yuan, with 218300 positions. This week, eg is in a strong shock, terminal recovery is slow, port delivery is on the low side, the port is affected by the closure of inventory, the port volume is on the high side, port inventory or accumulated inventory, affected by the high side of inventory, the load of domestic glycol device is high, the basic surface of glycol is still weak, but the domestic epidemic situation is gradually improving, the crude oil at the cost end is strong, driving glycol to be strong. As of Friday's close, the main contract eg2005 rose 2.3% to 4516 CNY/ton compared with last week, with 8611000 weekly deals and 153600 positions. The long-term contract eg2009 is 1.9% higher than last week to 4599 CNY/ton. Future market outlook: PTA industry chain, the terminal will resume work from this week, in a certain isolation period after the safety consideration of some weaving personnel, the terminal recovery is still relatively limited, with the gradual improvement of the epidemic situation, the terminal will start work or accelerate next week. Due to limited terminal recovery and light polyester production and sales, the polyester factory, especially the large factory, still has a large inventory pressure. With the early maintenance of the epidemic turning better, some factories have been restarted, and the starting load is stable at 60%, which may continue to increase in the future. PTA load rose slightly this week, inventory piled up rapidly, spot transactions were OK, processing fees have been reduced to about 400. PX at the cost end has little change, and the processing fee is maintained around $250.

Crude oil end, with the gradual improvement of the domestic epidemic situation, the crude oil end rose sharply, and the price center of PTA industry chain moved up under the low processing cost. At present, the processing cost of the industrial chain remains low, and the main contradiction in the follow-up is still in the crude oil end. Pay attention to the follow-up domestic epidemic control situation and the downstream resumption of work. With the gradual acceleration of the downstream resumption of work expectation, PTA or shocks are relatively strong. In terms of glycol, the terminal recovery affected by the epidemic is limited, polyester load remains low, and glycol demand is still weak. The domestic port inventory at the supply side is affected by the closure, but this week's port is not low, which forces part of the domestic load to drop. The new device is put into production in line with the progress, the overall load of glycol remains high, and there is still expectation of accumulation in the future. However, the current low price basically reflects the reality of weak fundamentals. The price changes or mostly follow the crude oil. Next week, with the resumption of domestic terminal factories, it will accelerate. Glycol is expected to be better.

The latest offer of this week's active contracts this week PTA was more volatile. The impact of the new crown epidemic continued, and the terminal recovery was still slow. The fundamentals of PTA accumulation were weak, but there was little space for downward compression of processing costs, while the cost end crude oil increased significantly, PTA fluctuated in a narrow range. As of Friday's close, ta005, the main contract, rose 1.9% to 4556 CNY/ton, with weekly trading volume of 2076600 and positions of 743400. Ta009 rose 1.1% to 4586 yuan, with 218300 positions. This week, eg is in a strong shock, terminal recovery is slow, port delivery is on the low side, the port is affected by the closure of inventory, the port volume is on the high side, port inventory or accumulated inventory, affected by the high side of inventory, the load of domestic glycol device is high, the basic surface of glycol is still weak, but the domestic epidemic situation is gradually improving, the crude oil at the cost end is strong, driving glycol to be strong. As of Friday's close, the main contract eg2005 rose 2.3% to 4516 CNY/ton compared with last week, with 8611000 weekly deals and 153600 positions. The long-term contract eg2009 is 1.9% higher than last week to 4599 CNY/ton. Spot, PTA spot trading atmosphere this week is OK, suppliers and traders mainly ship, individual suppliers buy, the basis of narrow range shocks. As of Friday, the internal quotation of CCF was 4375 CNY/ton, up 55 yuan from last week. The quotation for the outside market is 560 US dollars / ton, which is the same as last week. This week, MEG spot prices fell in shock. As of Friday, CCF had quoted 4417 CNY/ton, up 87 yuan from last week. The external offer is 530 US dollars / ton, 8 US dollars higher than last week. In terms of PTA spreads, this week saw a narrow range of volatility. As of Friday, the spot - 05 contract is around - 181. In terms of monthly price difference, as of Friday, the price difference was - 82. In terms of MEG price difference, the base of glycol was weak, and the base of spot eg05 as of Friday this week was - 99. In terms of the price difference between months, the price difference between months shows the structure of far monthly rising water, and the price difference between 5-9 is - 83.

PTA fundamentals upstream petrochemical industry chain, from the absolute price point of view, crude oil rose significantly, naphtha, PX followed the rise. From the perspective of processing difference, naphtha cracking price difference remained stable, PX processing difference remained at about $250, PTA spot processing difference slightly dropped to the low position near $400. At the PX end, ACP was not achieved in February, and PX oscillated in a narrow range. As of Friday, CFR Taiwan px749 USD / ton, and PX processing difference remained around 250 USD. In terms of units, the operating load of PX units in Asia fell to 76.8% to maintain. In terms of PTA supply and demand, PTA devices that reduce the negative load in the early stage gradually pick up. The unit load of 2.5 million tons of Hengli and 325000 tons of Luoyang Petrochemical Co., Ltd. was raised, and the PTA starting load was significantly reduced to 81%. PTA inventory increased significantly, and warehouse receipts for delivery increased significantly. At present, there are 77731 warehouse receipts + effective forecast. In terms of PTA plant dynamics next week, with the gradual recovery of the epidemic situation, PTA load will rise steadily.

In terms of glycol supply, due to the impact of high inventory, part of the plant load decreased this week. This week, Fude energy stopped for maintenance, and Far East United reduced its load to 60-70%. The load of domestic units decreased slightly, but remained at a high level. As of Thursday, the average weekly starting load of domestic glycol was 71.17%, of which the starting load of coal to glycol decreased slightly to 74.85%. In terms of port inventory, due to the impact of the closure, glycol vessels were delayed in large quantities. By the end of July 17, the port's inventory was about 646000 tons, down 70000 tons from the previous period. According to the statistics of CCF, this week's port is 210000 tons. The port of arrival is relatively high, but polyester maintains low load, glycol or continues to accumulate small amount. In terms of glycol cash flow, the cash flow of each process is near the break even point. The polyester end of the downstream polyester weaving fundamentals, affected by the epidemic situation, is still slow to return to work, and the polyester stock accumulation is fast. As of Friday, the POY, FDY, DTY and polyester short stock days are 26.4, 24, 35.7 and 8.7 days, respectively. Due to the light transaction of polyester, there is a virtual high market profit for polyester. Affected by the epidemic situation, polyester production was cut and stopped more. With the gradual recovery of the downstream, polyester load stabilized to 60.9% this week. In terms of terminal weaving, the resumption of production is relatively limited, and the load is increased slowly. As of Friday, the starting load of spring adding is 10%, and the load of loom is maintained at 14%.

Looking forward to PTA industry chain in the future, the terminal will resume work from this week, and there will be a certain isolation period after some weavers arrive at the post for safety consideration. The terminal recovery is still relatively limited. With the gradual improvement of the epidemic situation, the terminal will start work or accelerate in succession next week. Due to limited terminal recovery and light polyester production and sales, the polyester factory, especially the large factory, still has a large inventory pressure. With the early maintenance of the epidemic turning better, some factories have been restarted, and the starting load is stable at 60%, which may continue to increase in the future. PTA load rose slightly this week, inventory piled up rapidly, spot transactions were OK, processing fees have been reduced to about 400. PX at the cost end has little change, and the processing fee is maintained around $250. Crude oil end, with the gradual improvement of the domestic epidemic situation, the crude oil end rose sharply, and the price center of PTA industry chain moved up under the low processing cost. At present, the processing cost of the industrial chain remains low, and the main contradiction in the follow-up is still in the crude oil end. Pay attention to the follow-up domestic epidemic control situation and the downstream resumption of work. With the gradual acceleration of the downstream resumption of work expectation, PTA or shocks are relatively strong. In terms of glycol, the terminal recovery affected by the epidemic is limited, polyester load remains low, and glycol demand is still weak. The domestic port inventory at the supply side is affected by the closure, but this week's port is not low, which forces part of the domestic load to drop. The new device is put into production in line with the progress, the overall load of glycol remains high, and there is still expectation of accumulation in the future. However, the current low price basically reflects the reality of weak fundamentals. The price changes or mostly follow the crude oil. Next week, with the resumption of domestic terminal factories, it will accelerate. Glycol is expected to be better.