Demand Performance Falls Short of Expectations, PTA Prices Adjust Narrowly

September 20, News

The PTA plant's planned restart of its facilities has been delayed, while overall demand remains relatively stable. Meanwhile, cost support remains solid. As a result, the Chinese PTA market this week (September 15–19) has seen mostly narrow fluctuations. According to the commodity market analysis system, as of September 19, the average PTA price in East China stood at 4,631 CNY per ton, down slightly by 0.01% compared to the beginning of the week.

On one hand, the situation between Russia and Ukraine has sparked potential supply risks, particularly heightening concerns over crude oil supplies to a certain European country. This, coupled with the Federal Reserve's interest rate cut, has led to a recent rise in international oil prices, providing cost support for PTA. As of September 18, the settlement price for the November contract of U.S. WTI crude oil futures was $63.26 per barrel, and the December contract of Brent crude oil futures was $66.92 per barrel.

PTA processing fees remain near the lowest levels of the year, with factories operating at a loss. Xinjiang Zhongtai's 1.2 million ton facility was shut down on September 19, and the current industry operating rate in China is around 76%. Recently, there are expectations for some Chinese facilities to restart, but some PTA plants have added maintenance plans for October and November, which is beneficial for market sentiment.

On the demand side, there have not been many changes in polyester facilities, with only minor fluctuations in local loads. The overall load has increased to 91%. The terminal performance has been lukewarm; during the traditional peak season, the terminal performance fell short of expectations, and the order situation was average. Inventory pressure suppressed fabric prices, leading to a decrease in the price of polyester filament yarn, a reduction in raw material inventory, and a spread of pessimistic sentiment in the market.

Analysts believe that in the short term, cost support is firm, but with expectations of increased PTA supply and hindered downstream purchasing enthusiasm, it is expected that the Chinese PTA market will mainly experience weak fluctuations next week.