Just when major domestic media were still rushing to report on Jack Ma’s amazing appearance at Alibaba’s annual meeting, the polyester market was caught off guard by a “ticking time bomb”!
A report caused a flash crash in crude oil!
A new report yesterday based on Columbia University’s Center for Global Energy Policy argued that the number of privately owned small “teapot” refineries will shrink over the next decade as large refineries boom. Analysts believe this will reduce China’s crude oil demand. It is precisely because of this that oil prices fell. WTI October crude oil futures had a flash crash during the session, closing down $1.61, or 3.28%, to $47.48/barrel, a new weekly closing low.
PTA futures, ethylene glycol electronic trading fell sharply
At the same time, polyester raw material PTA futures and ethylene glycol, which are closely related to crude oil, suffered rapid declines in late electronic trading. The main PTA futures contract 1801 closed at 5228 points, a decrease of 1.28%, and the main ethylene glycol electronic trading contract 1711 closed at 7570 points, a decrease of 2.77%.
The fundamentals are good, polyester filament should rise even if it should!
As we all know, the polyester filament market has been booming recently. Since September, mainstream manufacturing companies have raised their product quotations one after another. Many factory prices have increased twice or three times a day, and there are even phenomena of reluctance to sell and wait for price increases. On the one hand, the strong demand from downstream terminals, and on the other hand, the collective rise of polyester raw materials such as PTA and ethylene glycol have supported the market of polyester filament. However, last night, just when everyone thought that the next day would be a week for chemical fiber people. On a day when I could take a break and adjust, a dramatic scene happened. PTA futures and ethylene glycol electronic trading suffered an instant plunge due to the flash crash of crude oil. Will the “promised” new round of price increases come to an end?
The author believes that although the recent mild upward trend in PTA futures and ethylene glycol electronic trading has given polyester filament end cost support, looking back over a longer period of time, the trend of polyester filament prices has not followed the same trend, closely following the pace of polyester raw materials. , on the contrary, there has been a good steady to upward trend. It can be said that in the recent stage, the “financial attributes” of polyester filament have weakened, and currently it is driven more by fundamentals.
1. Inventory is low, and polyester manufacturers have “packed lightly”
At present, after nearly four years of downturn, the polyester filament market has begun to pick up in the second half of the year, and the fundamentals of raw materials have also improved significantly. This is due to the fact that in recent years, polyester manufacturers have also changed their operating strategies for raw materials. From competing with each other to lower prices, they have now achieved effective internal control in the industry. In addition to holding meetings to unify their thoughts, the industry’s inventory can also be effectively controlled without suppressing prices. control, product efficiency is also gradually increasing. According to statistics, the operating rate of polyester filament factories is also at a normal level, with the current average operating rate of 80%. In addition, the current inventory of polyester factories is at a low level due to the impact of the previous rising market, and some manufacturers have zero inventory.
2. The recent start-up rate of the weaving end is relatively high, and the demand is temporarily stable
The dominant factor in the recent market conditions is the downstream demand side. From the perspective of the weaving market, although the market spent the third quarter amid environmental protection rectification, it did not affect the sharp decline in the weaving start-up rate. According to monitoring, the Shengze area recently The weaving operation rate can still be maintained at about 70%. In addition to market expectations, in fact, the market’s rigid needs and good profits have allowed companies not affected by environmental protection to operate at full capacity, which will effectively support the demand for polyester in the near future.
As for the trend of the polyester filament market next week, the author believes that after two days of diluted market news, the impact on the polyester raw material market next week may be significantly weakened, and it is unlikely that there will be another suppression operation from the capital market. In general, the fundamentals of the polyester filament market are generally good, and the market price will continue to rise as it should!
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