Touch Bottom Rebound Polyester Chip Dawning Difficult

Polyester market has experienced more than half of the gray market decline. Since the last weekend of May, PTA futures have finally gained a rebound. Polyester market is coming back to the bottom with raw materials. Production and sales hit a new high this weekend. Is this the beginning of dawn or the need for downstream terminal purchase? Let's see:

chart One Polyester chip price and profit trend

Source: lung Chung

The overall trend of polyester chips in May showed a downward trend. Polyester products fell to a low level in recent two years. In May, the polyester market was shrouded in haze. At the beginning of the month, the price of PX dropped significantly, the raw material PTA period was larger, the cost of polyester continued to rise, and the polyester chip manufacturers' profits were reduced to 51.53 yuan / ton. After the delivery of PTA05 contracts in the middle of the year, Dachang slowed down the intention of price increase. PTA's spot offer opened down mode, the cost collapsed, and the impact of weak demand, the polyester chip factory reported a fall and then fell, and the downstream market was more cautious. Traders mostly talked about it, and the suppliers only maintained the demand. The trading atmosphere is light and basically needs replenishment. Polyester production continues to expand, and also the raw material side of the raw materials, and the polyester chip market lacks confidence.

When we expect that the polyester chip market will end in a downturn in May, at the end of the last weekend, the pet market has been slightly higher, and the downstream market has been unfolding for a long time. The production and marketing of the polyester market is even higher, and the polyester production and sales of some enterprises are as high as 1300%. But after only two days of high-yield sales, the polyester market is still being replaced by the weaker market. As of the date of dispatch, the mainstream of the semi light section of Jiangsu and Zhejiang provinces was around 6700 yuan / ton, and the reference of 6750 yuan / ton for bright chips.

chart Two Comparison of production and marketing of polyester chips

Source: lung Chung

In fact, when the polyester chip production and sales climbed at the weekend, the pet producers' quotation also slightly increased by 50-100 yuan / ton, so as to take account of the wave of production and sale. Polyester slice on Monday production and marketing continues weekend fire, Monday polyester slice production and marketing in 200%, the average production and marketing in the first ten days of this month is 55%, the loop ratio is 145%, the market is not buying and falling law in this month.

chart Three Polyester chip price and stock trend

Source: lung Chung

At the end of the month, the PET production and marketing climax was coming. The stock of PET chips climbed from 5 days to 12 days in the beginning of the month, including the whole production and sales trend of Figure 3. In May, PET chip stocks rose continuously and prices narrowed down. So when the high production and marketing is approaching, the strength of polyester factories to stock up has become the focus of widespread concern in the industry. According to Xiaobian, the overall strength of polyester factories is 1/3. And polyester chip and other factories lack of confidence in pulling power, the downstream terminal has no substantive impetus to promote, although temporarily alleviate the high storage pressure of polyester, but there is no overall initiative, demand for good traction. Later, further attention will be paid to the stock and production and marketing trend of polyester chips.

To sum up, from the raw material side, PX has been affected by some production reduction plans in South Korea, resulting in a rebound in PX prices, a high level of PTA oscillation, and a stable base. In terms of ethylene glycol, although the supply is reduced, the inventory of the East China docks is more difficult to release, and the purchasing power in the downstream terminal market is still insufficient. It has no strong effect on the polyester chips and polyester products. Therefore, the information is expected to be short-term market or stalemate in polyester chips.