July 21 news
Commodity market analysis system, since July, the PTA market in China has shown a fluctuating upward trend. The average price of PTA spot market in East China is 6036 CNY/ton, an increase of 6.15% compared to July 2nd.
The ongoing mutual attacks between the U.S. and Iran have heightened dual risks to global energy supply routes, driving international crude oil prices higher once again. As of July 20, the settlement price for the September contract of U.S. WTI crude oil futures stood at $82.48 per barrel, while the settlement price for the September contract of Brent crude oil futures reached $89.22 per barrel, hitting new highs since mid-June. Meanwhile, with PX plants entering a concentrated annual maintenance period, Asia’s PX operating rates have fallen to their lowest level this year, providing strong cost support. In addition, several major PTA plants are undergoing maintenance, causing industry operating rates to drop as low as 57%. Tight supply and continued destocking have further fueled the upward trend in prices.
On the demand side, boosted by rising oil prices, polyester filament production and sales have increased in stages, with terminal inventory levels rising on a month-on-month basis. The inventories of downstream polyester products have decreased, maintaining rigid demand procurement for PTA. Currently, July is in the traditional off-season for the textile industry in China. High summer temperatures and frequent extreme weather have led to low operating rates for textile enterprises. Orders for the peak season of "Golden September and Silver October" typically start to be placed in mid-August, making it not urgent to replenish inventories in July. Terminal orders are mixed, with knit orders slightly increasing while woven orders remain sluggish.
Looking ahead, we need to observe the further developments of the US-Iran conflict. The maintenance of PX facilities is concluding at a slower pace, and PX supply remains relatively tight, thus providing support on the cost side. The textile market will gradually enter the autumn and winter order preparation period, and it is expected that the downstream polyester production will increase slightly, with an increase in restocking for essential needs, which will be beneficial to prices in the short term. However, as PTA facilities restart in August, the supply will become marginally looser, and the concentrated release of additional supply may put pressure on prices. In the short term, the PTA market trend is expected to mainly maintain an upward oscillation.
