It is reported that Saudi Arabia and Russia have reached a preliminary agreement to extend the current record production cuts for one month while increasing pressure on countries that do not comply with the production reduction agreement. Data shows that OPEC+’s implementation rate of production cuts in May was only 86%. As OPEC’s second largest oil producer, Iraq needs to reduce production by 1 million barrels per day, but the current implementation rate is less than 50%. Some West African member states have failed to meet their promised production reduction targets, with Angola and Congo having implementation rates of only 54% and 20% respectively.
The latest tough stances of Saudi Arabia and Russia have brought greater uncertainty to the oil market.
Affected by the news, international oil prices plunged during the session on the 3rd and closed slightly higher. As of the close on the 4th, New York crude oil July futures rose $0.12 to settle at 37.41 yuan/barrel; Brent August futures rose $0.20 to settle at 39.99 yuan/barrel. China SC crude oil futures, the main force in 2007, fell by 2.2 to 283.8 yuan/barrel.
Polyester raw material market: lack of upward momentum!
Affected by the fluctuation of crude oil, the polyester raw material market lacked upward momentum on the 5th, and the trend became divergent. Although PTA futures increased compared with the 4th, the increase was not significant.
In terms of PTA, the main PTA 2009 contract of Zhengzhou Commercial Exchange closed at 3,700 yuan/ton, an increase of 8 yuan/ton or 0.22% compared with the previous trading day.
In terms of ethylene glycol, the main ethylene glycol 2009 contract of Dalian Commodity Exchange closed at 3738 yuan/ton, which was lower than the previous trading day. Compared with last year, the price dropped by 46 yuan/ton, or 1.22%.
Some time ago, with the help of the rise in crude oil, PTA and ethylene glycol stopped falling and rebounded, and futures and spot prices continued to rise, but In the current situation of weak downstream demand and weak fundamentals, the prices of PTA and ethylene glycol mostly depend on the trend of crude oil prices. Now that crude oil has fallen, they naturally lack the motivation to rise.
Polyester filament: Has it risen?
However, this time, the polyester yarn market has a different trend from the crude oil and polyester raw material markets, and there has been a wave of gains. On the 4th, the price of polyester filament rose, with manufacturers’ quotations generally rising by 50-100 yuan/ton. The quotation of FDY 150D is around 6,350 yuan/ton, the quotation of POY 150D is around 5,550 yuan/ton, and the quotation of DTY 150D is concentrated at around 7,150 yuan/ton. On the 5th, the prices of some polyester yarns continued to rise. So far, the prices of polyester filament yarns have risen for 5 consecutive days this week.
Generally speaking, PTA is the most important raw material for polyester filament. The trend of polyester filament is basically the same as it, but the trend on the 4th On the contrary, the most important reason is that polyester yarn has hysteresis, and the increase is caused by the good news on the 3rd.
On the 3rd, the price of Brent crude oil was close to US$40 during the session. Favored by this, the spot prices of PTA and ethylene glycol futures rose sharply. Supported by the rise in crude oil and polymerization costs, downstream and terminal factories began to Focused on covering positions, polyester production and sales exceeded 100, and polyester prices rose significantly on the 4th.
Polyester filament has been rising for several consecutive days this week, which is still mostly dependent on the strengthening of crude oil prices.
On the 5th, OPEC said: OPEC will meet at 2 pm local time on Saturday (20:00 Beijing time), and the OPEC+ meeting will be held at 4 pm local time on Saturday (22:00 Beijing time). The convening of the production reduction agreement will bring news impact to the crude oil market and will also stimulate the trend of the polyester yarn market.
If the production reduction agreement is reached, crude oil prices will continue to rise, and may exceed the US$40 mark. By then, the downstream polyester market will also be stimulated by crude oil to rise, which will form effective support for polyester prices.
If the production reduction agreement is not reached, crude oil prices will continue to maintain the current range-bound pattern, and the impact on the polyester market will also be weakened.
But in fact, in addition to the impact of the crude oil market, the difficulty in improving the cost side and demand side has also brought more uncertainty to polyester prices.
一
It is difficult to destock PTA and ethylene glycol, and cost support collapses
The price of polyester yarn depends largely on the trend of polyester raw materials PTA and ethylene glycol. Although the prices of PTA and ethylene glycol have increased recently compared with the previous period, overall It seems that it is still at a relatively low level. As of now, the internal price of PTA is around 3,570 yuan/ton, and the internal price of ethylene glycol is around 3,650 yuan/ton. Compared with the same period last year, they have dropped by nearly 35% and 14% respectively. .
The collapse of PTA and ethylene glycol prices is mainly due to their own weak fundamentals. Ethylene glycol stocks continue to reach new highs in the new year, and PTA also It has also begun to enter the accumulation stage, and prices may fall further in the future. The cost support has collapsed, and it is difficult for polyester prices to rise sustainably.
二
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Terminal demand is difficult to improve, manufacturers are cautious in purchasing
Recently, nearly a hundred companies have participated in a survey on orders from textile companies. The survey shows:
Compared with the total order volume since 2020 compared with the same period last year, only 5% of companies said that orders have increased , 36% of corporate orders fell by 0-20% year-on-year, 50% of corporate orders fell by 20-60% year-on-year, and 9% of corporate orders fell by more than 60% year-on-year. The decline in foreign trade orders of textile companies is even more obvious, with 19% of companies’ foreign trade orders falling by 0-20% year-on-year, 52% of companies’ foreign trade orders falling by 20-60% year-on-year, and 29% of companies’ foreign trade orders falling by more than 60% year-on-year.
It can be seen that the textile market this year is indeed unsatisfactory, especially in foreign trade. Even if most countries have resumed work, it will not be a while before the orders are actually placed. Soon, even if there is, it will be difficult to improve the current situation in the era of “more monks and less rice”. A trader in the market said frankly: “In previous years, at this time, there were orders for tens of thousands or hundreds of thousands of meters of foreign trade, but this year there are no orders at all. It is too difficult to improve foreign trade. There will be no hope this year.”
The textile market has always been “30% domestic trade and 70% foreign trade”. It is difficult to recover foreign trade orders, and the domestic trade market is even more difficult to describe. For the weaving market, the demand is not strong, and the procurement of raw materials is even more cautious. Now the market is slowly entering the off-season. If the market is still unclear, cloth cannot be sold, and inventory continues to accumulate, the possibility of further decline in the loom operating rate will be greater. For polyester yarn, there is no demand and there is no price increase at all. Confidence, it is already good not to reduce prices significantly.
This year’s market is sensitive and fragile, and any slight disturbance can become a life-saving straw or the straw that breaks the camel’s back. The price of polyester yarn has increased significantly compared with April. Without bright spot support in the weaving market or favorable news stimulation, sustained price increases are difficult. </p
