Raw Material Side Shows Resilience—PTA Prices Surge Over 3% in a Single Day

December 22, news

As of the close on December 22, the 2605 PTA contract closed at 5040 CNY/ton, up 218 from the previous day's settlement. The spot market also remained strong. According to the commodity market analysis system, on December 22, the PTA spot market price in the East China region was 4879 CNY/ton, an increase of 3.04% from the previous trading day.

The geopolitical conflicts between Russia and Ukraine, as well as between the U.S. and Venezuela, provided a short-term boost to oil prices, and on December 19, international crude oil futures closed higher. The February contract for U.S. WTI crude oil futures settled at $56.52 per barrel, up $0.52, or 0.9%. The February contract for Brent crude oil futures settled at $60.47 per barrel, up $0.65, or 1.1%. Recently, there have been few changes in PX plant operations, and inventories are expected to accumulate slightly in December. However, given the tight spot market liquidity and low inventory levels, PX prices remain supported.

From the perspective of domestic supply, the operating rate of China's PTA industry is around 73%, and Yisheng New Materials plans to undergo maintenance in January-February. Under low processing fees, factories' production enthusiasm is limited, and there is a possibility of additional unplanned maintenance, limiting the extent of supply increase.

There are currently no significant changes to the downstream polyester production facilities, and operating rates remain relatively high at around 91%. However, sentiment toward further price increases in raw materials has been rather subdued. As the consumption season enters its off-season, demand from end-users has weakened somewhat, with inventory accumulation occurring in both woven and knitted fabric segments.

Analysts believe that the current terminal market in China is lukewarm, with low enthusiasm for price increases in the downstream polyester sector. However, the PTA raw material end remains firm. With continuous destocking and low processing fees, the short-term PTA spot market in China is expected to remain strong.