SunSirs: The Fundamentals Lacked Favorable Conditions, and PTA Prices Fluctuated and Weakened

Price trend

According to the commodity market analysis system of SunSirs, the domestic PTA market has declined slightly since September. The average spot price of PTA in East China was 4,631 RMB/ton, down 2.6% from the beginning of the month.

Analysis review

Weakening cost support and the gradual realization of OPEC+ production increases in the international crude oil market have driven down crude oil prices. As of September 12th, the October contract for US WTI crude oil futures settled at $62.69 per barrel, and the November contract for Brent crude oil futures settled at $66.99 per barrel. OPEC+ maintains its production increase in October, increasing the risk of oversupply. Furthermore, with the traditional peak fuel season coming to an end and demand entering a turning point, the supply-demand landscape was temporarily showing signs of oversupply. Coupled with the lack of escalating geopolitical tensions for the time being, crude oil prices are likely to continue to weaken.

Recently, Hengli Huizhou and Xinfengming's plants, which had been undergoing maintenance, restarted in early September, partially alleviating the tight domestic PTA supply situation. The industry's current operating rate was around 77%. While PTA initially relied on production restarts to maintain destocking, this trend is unlikely to continue in the future. With new plants expected to come online in October, continued growth in domestic supply is expected.

The traditional peak season for downstream production has arrived, but terminal orders were generally subdued, with lukewarm demand and a lack of substantial drivers. Polyester filament manufacturers, in particular, remain eager to ship goods, continuing promotional activities and lowering prices. In the polyester staple fiber market, downstream spinning orders have rebounded compared to the previous month. While overall order volume has fallen short of expectations, positive news has boosted market sentiment, leading to a modest increase in polyester staple fiber purchases and a resilient price performance.

Market outlook

Analysts from SunSirs believe that the PTA market was cautious, with concerns about increased supply and lukewarm demand during the traditional peak season. In the absence of a significant boost in fundamentals, PTA prices are still mainly volatile and weaker.

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