SunSirs: Short-Term PTA Prices Continue to Fluctuate

　　Affected by the heavy drop in international oil prices, resulting in the collapse of the cost-side support, the current price of PTA dropped significantly yesterday (July 20). As of July 20, the average domestic PTA spot market price was 5,050 yuan/ton, down 2.29% from the previous trading day and up 43.43% year-on-year. The main force of PTA futures 2109 closed 4974, down 158, or 3.08%.

　　But today, there are rumors in the market that the main port of the Yangtze River was affected by a typhoon, and the route was closed for three days. The supply of PTA Zhapu and other regions was tight, and the current price fluctuated upward. Superimposed, oil prices rebounded slightly and cost boosted. The main force of PTA futures 2109 closed at 5190, up 204, or 4.09%. The average spot market price was 5182 yuan/ton, up 2.61%.

　　On the supply side, Fuhai Chuang’s 4.5 million tons/year PTA plant has recently reduced its load to 60-70% in mid-July 2021. The 1.2 million tons PTA plant of Ningbo Taihua will be overhauled from July 10 to 28, 2021. Luoyang Petrochemical’s PTA plant with an annual production capacity of 325,000 tons was shut down in early July 2021 and has been restarted recently, and the start-up load is not high. The overall PTA industry operating rate is around 80%. The downstream polyester maintains a high operating load of about 88%, and the demand for PTA is relatively stable. Therefore, PTA is likely to be destocked in July.

　　On the whole, considering the recent tight liquidity spot in the PTA market, supply and demand support is acceptable. In addition, we are worried about the problem of unloading from the source of goods to the port due to the weather. It is expected that the short-term PTA price will continue to fluctuate and warm, but we still need to pay attention to the oil market dynamics.