Before the May Day holiday, polyester enterprises urgently need to de-stockpile. They have started the promotion mode one after another. Some enterprises have lowered their offer by 100-200 yuan/ton. Most of them have stable quotations, and the actual discount is 100-400 yuan/ton. The future market expectations of downstream weaving enterprises are still pessimistic, moderate warehouse replenishment, polyester production and sales have improved compared with the earlier stage, but they have not met the psychological expectations of enterprises. The effect of individual enterprises'de-inventory is significant, and the inventory pressure of most enterprises still exists. It is understood that at present POY inventory is more than 13-15 days, FDY inventory is more than 17-20 days, DTY inventory is more than 25-28 days.
Under the pre-festival sales promotion, the downstream is still in need of replenishment. There may be some inventory pressure in the polyester market during the May Day holidays, but according to industry sources, there may be a wave of purchasing peak in the downstream after the festival, so the falling space may be alleviated.
Insufficient cost support & nbsp; sluggish polyester Market
In fact, throughout April, PTA spot market changes closely follow the fluctuation of device news, polyester market also follows the trend of PTA market. In late April, when PTA overhaul expectations are set, the favorable impact of device overhaul expectations on the supply side begins to weaken. Although crude oil prices have risen to a new high in recent months, the launch of PX in Hengli market has led to market concerns about the supply side of PX, PX profit. Compression of profit makes profit yield to PTA, PTA processing fee has reached a new high. As of April 28, PTA processing fee was 1728.13 yuan/ton, up 507.53 yuan/ton from last month, an increase of 41.58%. Compared with the same period last year, it rose 957.58 yuan/ton, an increase of 124.27%. It is much higher than the same period last year.
In recent years, the domestic ethylene glycol market has continued to decline, which is about 85 yuan per ton lower than the price negotiated last week. Domestic ethylene glycol production enterprises are experiencing losses to varying degrees. Some enterprises are gradually entering the overhaul period, but the role of alleviating inventory pressure is very limited. In addition, the recent production and marketing of polyester is flat, and the raw material end needs to be purchased primarily.
After May 1st, under the premise of high start-up and high cash flow of polyester, the cost of PTA is 90% determined by PX, which is the direct raw material. The negative impact of the cost side on PTA is very great.
Therefore, the further production and release of PX in the second quarter will also suppress PTA. However, due to the exemption of U.S. sanctions on Iranian crude oil, crude oil prices are still likely to rise in geopolitics, which will support PTA in the short term. However, if the terminal orders continue to decline over time, it will be difficult to maintain the high start of polyester market. PTA demand will be dragged down, so the negative factors of PTA in the later period still exist.
Loom is cautious because of poor terminal demand
Downstream, the overall inventory of polyester rose, production and sales warming persistence is not good.
At the end of April, the overall starting rate of looms in China was 75.8%, and the ring ratio dropped by 1.72%. Among them, the comprehensive start-up rate of air-jet looms is 90%, the ring ratio is down 2.6%, the average start-up rate of water-jet looms is 89.4%, and the ring ratio is down 1.45%.
Although the loom start-up rate has not declined significantly at present, and the stock of loom raw materials is low, but the enthusiasm of pre-season procurement is not high. According to the understanding of the loom factory, the previous orders weakened after 5.1 holidays, while the order situation in 2019 has weakened since the Qingming Festival holidays.
Lower demand orders and continuing downstream plain cloth factory orders make the finished product inventory in the downstream terminal market higher. Most of the 100-300 loom-scale enterprises have finished product inventory in 27-35 days. Most of the 20 looms and enterprises below are based on order production. The conventional finished product inventory is in 7-10 days. The peak season is coming to an end, so the weaving enterprises are declining because of their own orders and profits. In fact, their stock of raw materials is relatively high, many small and medium loom manufacturers have the expectation of shutdown, and further purchase intention is insufficient.
List of Inventory, Start-up, Production and Marketing Change of Polyester Products
It can be seen that poor terminal orders lead to stagnation of product transmission. Polyester factories have not seen the phenomenon of low inventory since the Spring Festival holidays, and the enthusiasm of weaving factories to buy Polyester will be restrained again.
The favorable atmosphere brought about by OPEC's production reduction is still continuing. At the same time, Venezuela's crude oil production is declining, and the tension between the United States and Iran is a positive impetus for oil prices. However, it is difficult for PX to keep up with the rising trend under the expectation of loose supply, while PTA processing costs remain high, the impact of equipment maintenance news on the market continues to weaken, the cost of polyester market is temporarily not boosted by positive factors, downstream terminal orders are general, purchasers are basically just in need of replenishment, the polyester market in the late May holidays may have some inventory pressure, but there may be a wave of purchasing peak downstream after the holidays, so there is a downstream trend. Decline space may ease somewhat. We still need to pay attention to the downstream stock situation.
