test


Member ID:
Password: 
Stay logged in for 30 days
Forget Your Password?
close

login CCFGroup App

Insight | Time:Jan 10 2018 4:35PM
PTA supply and demand forecast in Q1, 2018
 
Text size
New PTA capacity in 2018 is limited, may be only the rest 1.1 million of Jiaxing PC phase II project. However, the old units may bring heavy pressure. Xianglu, if Dragon Aromatics restarts the PX unit in Gulei, may restart 3# 1.5 million PTA unit. Reignwood may restart the 1.4 million mt/yr PTA unit soon, which will influence PTA supply and demand in Xiaoshan and Shaoxing regions. But some small units such as Jialong (600KTA), Liwan (700KTA) and Pengwei (900KTA) as well as Sinopec subsidiaries may shut from time to time.

If no units are obsoleted in 2018, PTA capacity will reach 49.24 million in the end of 2018 with a production of about 40-40.5 million tons so the growth should be around 12%. Assume PTA production is 40.2 million tons, subtract 1.45 million tons for non-polyester applications and 250 KT of net exports, about 38.5 million tons will supply polyester sector. We can see PTA supply and demand situation under different polyester production growth varies as follows.

PTA production 40.2 million tons
PTA supply in polyester sector 38.5 million tons
Polyester growth 7% 7.50% 8% 8.50%
Polyester production (mln tons) 43.87 44.08 44.28 44.49
PTA consumption (mln tons) 37.73 37.9 38.08 38.26
PTA supply-demand (KT) 770 600 420 240

Generally speaking, PTA inventory may increase in the first half and then decrease in the latter half of 2018. PTA supply and demand may present healthy in the second and third quarters. In detail, PTA inventory may increase in the first quarter due to the impact from lunar New Year. Judging by historic data, PTA inventory usually increase by about 500 KT in the first quarter but in 2015, the number hit as big as 800 KT. As to the first quarter of 2018, Jiaxing PC may start up the rest 1.1 million of the new project. However, quite a few PTA plants kept running with flaws in the last quarter of 2017 due to lucrative margins and they may choose to shut for turnaround in the first quarter.

PTA maintenance plans
Producer Capa (KTA) Location Detail
Helen CF 1200 Jiangsu Shut for 20 days since Jan 1
Yisheng 2000 Hainan To shut for turnaround since Jan 17
Yisheng 2200 Zhejiang To shut for turnaround in Feb
Hanbang 2200 Jiangsu To shut for turanround in Jan-Feb
Yisheng 3750/2250 Dalian To shut for turanround in Mar
FCFC 1200 Zhejiang Shut for 4-5 days since Jan 4

As to demand, the scale of maintenance of polyester plants during the lunar New Year holiday was not too big under tolerable profits and inventory. In addition, the new polyester units will largely start up in the first half of 2018, which will compensate the production loss on some extent so demand side may perform healthily. The operating rates of polyester plants may be the key. Assume the average operating rates of polyester plants fix at 87% in Jan, 82% in Feb and 87% in Mar, thus PTA inventory may cumulate by about 500-550 KT in the first quarter, of which February contributes about 300 KT.

In Jan, spot prices may maintain firm and PTA futures may continue hitting the ceilings. The shutdown plans of polyester plants is the key. When will PTA supply and demand turn balanced or even reversed is crucial for 2018 market forecast. Judging by historic prices, the bottom of PTA prices in the first half of the year usually arrive in Apr or Jun. If PTA inventory does not cumulate much in the first quarter and market fundamentals strengthens after March, the market outlook may be promising. Polyester operating rate, PTA supply/demand, polyester inventory and end-user consumption are worth concerns.
Related Articles
PTA market daily (Jun 21, 2018)
PTA market daily (Jun 20, 2018)
PTA market daily (Jun 19, 2018)
PTA market weekly (Jun 11-15,2018)
PTA market daily (Jun 15, 2018)
PTA market daily (Jun 13, 2018)
PTA market daily (Jun 12, 2018)
PTA market daily (Jun 11, 2018)
PTA futures market daily (Jun 11, 2018)
PTA market weekly (May 21-25, 2018)
 
Research
Brief analysis of annual reports of some listed companies ...
Nylon and polyester markets in reverse trend
 
 

浙公网安备 33010902000742号