Recently, under the boost of costs, the domestic polyester staple fiber market has shown a slight increase. As of December 22, the average price of 1.4D * 38mm in mainstream factories in Jiangsu and Zhejiang was 7168 yuan/ton, up 0.58% from December 15.
The escalation of geopolitical tensions between Russia and Ukraine has prompted the United States to announce a new round of sanctions against Russia. In addition, OPEC+may extend its production reduction plan again at its December meeting and may postpone it until the second quarter of next year, which is positive news for international oil prices. However, the weak demand in the international crude oil market and investors’ concerns about the prospect of oversupply in the crude oil market still exist, which is bearish for the oil market. On December 19th, the settlement price of the main contract for WTI crude oil futures in the United States was $69.38 per barrel, and the settlement price of the main contract for Brent crude oil futures was $72.88 per barrel.
The domestic PTA spot market has slightly increased, with an average price of 4809 yuan/ton in the East China PTA market as of December 22, up 2.75% from December 9. In the second half of November, the PTA pre maintenance equipment will resume operation, but with the current processing fees, there will be less maintenance of the PTA equipment. Yisheng Ningbo’s 2.2 million ton PTA plant will shut down on December 9th; Jiaxing Petrochemical’s 1.5 million tons will undergo maintenance on December 12th. Dushan Energy’s 2.7 million ton PTA new plant began trial operation on December 18th. The current industry production is around 86%, and the overall supply in December is relatively loose.
The textile industry continues the off-season, and downstream yarn factories maintain on-demand procurement. The inventory level of raw materials for terminal textile enterprises is not high, and there is still some time before the Spring Festival. This round of replenishment is expected to be mostly for pre year orders, and there is still room for replenishment in the later period. In addition, domestic macro policies have released a series of positive signals, including promoting domestic demand, and it has been heard that export orders have performed well.
According to analysis by Shengyi Society, the market’s expectation for seasonal accumulation of crude oil inventories remains strong, coupled with the weakening of the US dollar, which continues to exert pressure on rising oil prices. International crude oil may operate weakly. With the investment of new production capacity, PTA production in December may reach a new high for the year, and the supply-demand contradiction of PTA is difficult to alleviate. The fundamentals are difficult to be optimistic, and support for short fiber costs is weakened. There has been no significant increase in downstream terminal orders, and the sustainability of demand side replenishment needs to be monitored. Overall, the price of polyester staple fibers may decline.
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