Price trend
According to the SunSirs commodity market analysis system, the domestic PTA market generally trended downward last week (June 22–28), with price movements driven by crude oil costs; on June 28, the average spot price of PTA in East China stood at 5,734 RMB/ton, down 5.10% from the beginning of the week.
Market analysis
On the cost side, the geopolitical premium for crude oil has dissipated; as of June 25, the settlement price for the August WTI crude oil futures contract stood at $71.92 per barrel, while the September Brent crude contract settled at $75.50 per barrel. With geopolitical tensions easing and navigation risks in the Red Sea and Strait of Hormuz subsiding, international crude oil prices have undergone a rapid correction from their highs. Asian PX prices have weakened in tandem with crude oil, shifting the cost basis for PTA downward.
Regarding supply, the market is balancing maintenance shutdowns against production restarts, with low inventory levels providing only weak support. Specifically, Hengli Petrochemical’s No. 4 unit (2.5 million tons/year capacity) was shut down on April 9 and is scheduled to restart soon. Dushan Energy’s 3-million-ton unit was shut down on June 24, and Fuhaichuang’s 4.5-million-ton unit was shut down on June 25; meanwhile, Dongying Weilian’s 2.5-million-ton unit is slated for shutdown at the end of June. Operating rates remain low at around 64%, while factory inventories continue to decline and spot inventory levels remain low.
On the demand side, the market remains in the traditional June off-season for textiles, characterized by persistent sluggishness and a lack of growth drivers. Operating rates for looms in the Jiangsu and Zhejiang regions are low, grey fabric inventories are accumulating, and the production and sales of polyester filament are weak. Downstream polyester plants are generally operating at a loss and show no willingness to restock, purchasing only on an as-needed basis; consequently, there is little upward transmission of demand. While steady demand for PET bottle chips offers a slight offset to the weakness in polyester filament, it is insufficient to improve overall demand conditions.
Market outlook
Analysts at SunSirs believe that, in the short term, crude oil price fluctuations remain the dominant factor; a rebound in oil prices would trigger a technical correction for PTA, whereas a continued decline would push prices to test new lows. These factors are compounded by weak off-season demand, expectations of production resumption, and reduced operating rates downstream due to losses. Amidst this confluence of bearish factors, PTA prices are expected to trade with a weak, fluctuating trend.
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