Recently, PTA futures have continued their decline and continued to fall. As of the close at 23:30 on October 18, the main 2001 contract of PTA futures fell to 4968 points, and it seemed that there was a trend of “never coming back” below 5000 points.
Behind the continuous decline of PTA is a sluggish economic environment. The United States is “making trouble” in the global market, fighting trade wars with China, ASEAN, and the European Union. The economic growth of various countries has slowed down, resulting in a more obvious decline in end-use clothing demand. Under such circumstances, the upstream and downstream of the polyester industry chain can only rely on “resting on their laurels” to survive.
Supply and demand The hidden danger of imbalance is highlighted, and PTA fell below 5,000 points
If you use one word to describe this year’s PTA, it is “willful”.
In the first half of the year, when the profits of polyester filament, PX, and ethylene glycol were sluggish, and some products even fell into losses, PTA “outshines”, with profits once exceeding 1,000 yuan.
But in the second half of the year, PTA’s style changed suddenly and turned into another kind of “willfulness”. No matter what good news stimulated the market, PTA would not increase prices, even if it was due to some emergencies. It rose a little, and then fell back down soon. The price of PTA futures is hovering around 5100 points.
The reason is that the PTA’s “old capital” is almost eaten up . The main reason for PTA’s high profits in the first half of this year is that PTA had almost no new production capacity in 2018 and the first two or three quarters of 2019, resulting in tight PTA supply and demand.
But this situation will change in the fourth quarter of 2019. Once the PTA device of Hengli and Xinfengming with a total production capacity of 4.7 million tons begins production, PTA will become Supply exceeds demand, which is the main reason why the market has been bearish on PTA recently.
The phenomenon of “resting on one’s laurels” is serious among weaving companies, and only old customers place orders
Compared with PTA , the phenomenon of “resting on one’s laurels” in the weaving market located downstream of the industrial chain is even more serious.
At the just-concluded 6th Shengze Textile Expo, the editor interviewed several textile companies, including a large textile trading company that mainly exports to India and Southeast Asian countries , only conventional polyester taffeta exports nearly 10 million meters per month.
The person in charge of the company said that the overall market situation this year is not good, so even in the Southeast Asian market, which has always been regarded as a “blue ocean”, the export volume this year has not increased but decreased.
For conventional products that are in great demand but have many companies that can make them, their companies usually find fixed factories when the price difference is not too big. Under such market conditions, there is simply no strong will to find new suppliers.
This situation is even more obvious when it comes to weaving companies. It is understood that most of the orders that weaving companies can now receive are Ordered by an old customer. Some companies have a stable customer base and can live a good life if they place more orders. Otherwise, life will be more difficult.
But “old customers” are not omnipotent. Once a customer with whom we have cooperated for many years has a problem, the matter will become more serious.
During a previous visit, the person in charge of a large-scale weaving factory with more than 1,000 looms said that this year, an old customer they had cooperated with all year round chose to withdraw due to insufficient terminal clothing orders. market, and this customer’s orders accounted for more than 30% of the total orders in previous years. Nowadays, the weaving market is in a state of overpopulation and there is no way to properly absorb the suddenly vacated 30% of production capacity.
PTA’s “old capital” is almost exhausted. Weaving companies are also facing the same dilemma. In the final analysis, the terminal market is still shrinking, and last year’s market was too good, which led to the market’s wrong judgment on this year’s market.interruption and excessive investment in production capacity.
Due to the lag in the launch of production capacity, when the market enthusiasm subsides, the previously invested production capacity now looks a bit out of date, but there is no turning back.
In the short term, the United States is “warring everywhere” around the world, and Sino-US trade frictions are still continuing. In terms of international trade, the growth of the emerging Southeast Asian markets has also stagnated this year. Demand in Europe has gradually shifted to recycled and environmentally friendly fabrics. The demand for traditional conventional fabrics has not picked up in a short time.
In the long run, as long as the international environment does not change drastically, The overall trend of the world economy is developing, and the demand for clothing is also increasing year by year. This year’s sluggish market is just an exception and may not last too long. Once terminal demand picks up in the future, the excess production capacity in the past two years will eventually be digested. Maybe by that time, the market will really improve and the upward channel for polyester products will open again.
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