Fundamentals Improve Temporarily, PTA Prices Rise Slightly

August 23, news

According to the commodity market analysis system, this week (August 18-22) the PTA market in China showed a slight recovery. The average price of PTA in the East China region was 4,771 CNY/ton, an increase of 1.08% from the beginning of the week.

Crude oil market prices have remained volatile. As of the 21st, the settlement price for U.S. WTI crude oil futures was $63.52 per barrel, while Brent crude oil futures settled at $67.67 per barrel. Meanwhile, PTA fundamentals have improved overall: on the cost side, PX supply from overseas markets has tightened slightly, while in China, expectations are growing for increased demand as new PTA units near commissioning. Consequently, PX prices have gradually strengthened. However, PTA production facilities in East and South China have delayed restarts or remain offline due to operational issues, leading to an optimized supply structure. Downstream polyester demand remains robust, with steady spot purchases driving strong sales and production volumes. Additionally, recent improvements in broader macroeconomic conditions have boosted investor sentiment toward commodities, further contributing to a modest rise in PTA market prices.

Looking ahead, in terms of PTA supply, with persistently low processing margins, there are increased plans for PTA plant maintenance in August. Coupled with the unplanned maintenance of the Hengli Huizhou PTA facility over the weekend, and expectations that new adjustments to China's PTA facilities will not be significant, the short-term supply is expected to tighten. The overall industry operating rate is around 71%.

As costs continue to rise, the sentiment of downstream polyester factories has also been boosted, with the polyester filament industry rising in tandem. However, resistance from downstream weaving enterprises is increasing, and they are mainly maintaining essential inventory replenishment. In terms of terminal weaving, since August, with the easing of tariffs, orders for autumn and winter fabrics and foreign trade home textiles have gradually increased, and the operating rate of the mainstream weaving industry in the Jiangsu and Zhejiang regions is around 52%.

Analysts believe that PTA is currently experiencing a phased improvement in supply and demand, and with the traditional peak demand season of September and October approaching, there are expectations for demand in September. Among these, the rigid demand orders for early winter home clothing and bedding fabrics are being gradually released, and at the same time, autumn clothing orders are entering a concentrated shipping period, which will jointly promote a continued warming of the overall market atmosphere. Additionally, driven by macro factors and costs, PTA prices are expected to remain strong in the short term.