News summary
The domestic PTA market rose slightly this weekbaccaratde, the average price increased by 0 month-on-monthbaccaratde.52%。Analysts expect the risk of falling PTA prices due to fluctuations in oil prices, frequent equipment repairs and weakening demand for polyester.
Newsletter text
The domestic PTA spot market fluctuated and rose this week, and the average price in East China increased slightly to 5946 yuan/ton.
The domestic PTA spot market showed a turbulent upward trend this week (May 20 to 25). As of May 25, the average market price in East China was 5946 yuan/ton, an increase of 0.52% from the beginning of the week. [Domestic PTA units are undergoing frequent changes, and the industry operating rate remains at 75%] As Dongying United's 2.5 million-ton PTA unit starts maintenance that is expected to last for 40 days, Yisheng New Materials's 3.3 million-ton unit will also start on May 16. A 20-day overhaul will be launched. Ningbo Taihua's 1.5 million-ton unit will be stopped from May 23 and is expected to be suspended for one month. At the same time, Innios Zhuhai's 1.25 million-ton PTA unit has been suspended for four days since May 20, but has resumed operations over the weekend. Currently, the PTA industry's operating rate remains at about 75%, and few changes in equipment are expected next week. [International oil prices fluctuated due to multiple factors, and the PTA market was boosted] At the beginning of the week, due to the positive impact of improved oil demand expectations, lower U.S. crude oil inventories and geopolitical tensions, international oil prices rose, which had a positive effect on the PTA market. However, the Federal Reserve's minutes showed a possible delay in interest rate cuts, coupled with an unexpected increase in U.S. oil inventories, led to a downward correction in oil prices over multiple trading days. As of May 23, the settlement price of the main contract of WTI crude oil futures in the United States was US$76.87/barrel, and the settlement price of the main contract of Brent crude oil futures was US$81.36/barrel. The price of WTI crude oil fell to a three-month low. [Supply pressure in the PX market eased due to unexpected parking] In the PX market, Malaysia's 550,000-ton PX unit resumed operation earlier this week after being shut down due to a failure on May 9. At the same time, Saudi Arabia's 1.34 million-ton PX unit also encountered unexpected shutdowns. It had previously operated unstable and operated at low load. Since May, accidental parking incidents have occurred frequently, effectively alleviating supply pressure. [Downstream polyester factories reduce production, and PTA demand faces challenges] Although downstream mainstream polyester factories concentrate on reducing production and tend to support the market, and make appropriate replenishment of raw materials, the off-season effect of the terminal market and changes in summer weather have caused polyester operating rates to decline, demand for PTA will weaken, and there is expectation of accumulated stocks. Reduced demand may exacerbate PTA oversupply and put pressure on PTA prices. [Analysts predict that PTA prices are more likely to fall] Analysts expect that as crude oil prices fall, PTA's cost support will weaken, and downstream polyester factories are more likely to reduce production, resulting in reduced demand for PTA. In addition, the low processing costs in the market may also increase unplanned maintenance of PTA units. Against the backdrop of the current lack of positive news on fundamentals, PTA prices are expected to face a greater possibility of falling.
