Crude Oil Supports Strong PTA Weekly Gain of Nearly 8%

This week (February 28-March 4), the domestic PTA market rose first and then fell. As of March 4, the average market price in East China was 6,097 CNY/ton, a weekly increase of 7.79% and a year-on-year increase of 33.71%.

The PTA market rose this week, followed by crude oil. Oil prices surged to their highest levels since 2008, driving up PTA costs. As of March 3, the settlement price of the main U.S. WTI crude oil futures contract was reported at US$107.67 per barrel, and the settlement price of the main Brent crude oil futures contract was reported at US$110.46 per barrel. The current US-Iran nuclear negotiations have made some progress, and the return of Iranian oil to the international supply market has eased supply tensions to a certain extent.

The maintenance of domestic PTA factories has increased, and the industry operating rate has been reduced to around 74%. Next week, Yisheng Ningbo 3# 2 million tons and Yisheng Dahua 2.25 million tons PTA plants are scheduled to restart, but some unplanned PTA plant maintenance is not excluded. The downstream polyester maintains a high operating load of more than 86%, and the demand for PTA is stable. In terms of prices, the polyester market also shows a slight increase under the boost of raw materials. However, after entering March, the terminal orders have not improved significantly, and the downstream inquiries are still relatively light. Some weaving factories produce regular inventory, foreign trade orders have not been placed in batches, and the follow-up of new orders is slow. Procurement is the main.

Short-term cost factors dominate the PTA market, and crude oil is easy to rise and difficult to fall, and may continue to push up PTA. In addition, in terms of supply, under the low processing fee, there may be unplanned maintenance and production reduction of PTA units. At the same time, it is necessary to pay attention to whether the planned restart of PTA units is restarted as scheduled. In terms of demand, the traditional peak season of gold, silver and silver is coming, and the number of orders in the terminal textile peak season is expected to increase, or there will be a wave of replenishment. Therefore, the short-term PTA price will still fluctuate and rise.