PTA impact on the future market of a number of key factors

With the crude oil, coal, natural gas and other energy products on the basis of a significant decline in chemicals as a whole since the end of 1999 since the economic cycle. According to the chemical cycle to maintain an average of 7-8 years speculated that the current round of economic cycle in the U.S. sub-loan crisis as a prelude to the end of the global financial crisis: energy-based decline in demand for the lower reaches of inadequate macro-economic tightening liquidity, a large number of low-cost petrochemical installations in the Middle East The impact of global production (especially in Asia), chemical fiber industries because of the cost of the upper reaches of collapse, their excess production capacity, the lower reaches of insufficient demand, the macro-tightening and blocked the export slump and other factors. Since June 17 this year since, PTA outside and inside the disk set price (in U.S. dollars and Renminbi) and 1190USD/MT from 9850 yuan / ton, down to the October 24 and 655USD/MT of 5650 yuan / ton, 4 months down the cumulative rate of 44.96%, respectively, and 42.64%, PTA futures price on June 19 from a maximum of 9968 yuan / ton, down to October 24 of 5206 yuan / ton, down a total of 47.77 percent.

The author believes that the future impact of PTA market of the major factors are as follows:

First, PTA market is bottoming out from the upper reaches of the need to stabilize the raw materials to establish. National Day after the market fell from the upper reaches of crude oil was caused by the crash, the PX is a follow-up all the way down at the same time, domestic polymerization plant due to high inventories and the beginning of a significant sale to reduce the risk of stock at a discount and ready by the end of the bank repayment. In the oil does not stabilize, we still can not determine the future of the market at the bottom and lower reaches of this year, the sales situation is not satisfactory.

Second, the industry’s major supplier of capital chain break the tie, a severe blow to confidence in the industry. Hualian Sanxin PTA as a domestic first-class supplier since 2007 has been due to the deterioration of industry competition, constant cash flow losses experienced in that year operating loss on the basis of 960,000,000 yuan this year in the domestic textile industry to shrink, the upper reaches of the soaring cost of the , Jukui again, in the final in 2008 during the National Day parking reorganization of the current reorganization proceeding smoothly, by the end of October to determine the basic car.

Sanxin events on the one hand, accelerated the collapse of the PX market, the textile industry on the other hand, Xiao Shao made the situation worse, the market confidence in the hard-hit. If you drive in the late, but we think in the short term the market is a positive, because of its procurement to the Asian PX spot can be a good support, a month 100,000 tons of PX demand on the PX market is a major positive, or PX will bring short-term market stable, or even rebound.

We know that, PX-PTA-polymerization of these link are capital-intensive industries, their operating income from the following two factors: control of raw materials and industry competition. Because the industry always will be accompanied by excess production capacity, product homogeneity flowers, such as lower gross profit margins, so we can be summed up in one sentence of this industry: industry competition decided to present value, control of raw materials and industrial integration of the value of the decision .

Third, PX surplus in 2009 will have a industrialization of the PTA to ease up the opportunity. In the aftermath of the 2004-2005 aggregate production of high-growth after ,2005-2007 PTA made great device to concentrate on driving, and 2007-2009 is expected to be high-speed operation in the PX. According to statistics, in the fourth quarter of this year there are 4 sets of national plans of the new PX device will drive the market supply, the total production capacity at 2,850,000 tons, so no large-scale installations in the PTA production, in the current PX has been relatively relaxed environment, we It is foreseeable that in the future over-PX is no problem. From that point on, the next step PX may follow the PTA industry.

Fourth, PTA futures markets continue to mature and reflect the hedge function, mobility on the increase in the future will be driven spot market prices. 809 experienced a large number of contract delivery, the current position has not PTA substantial increase was mainly brought about by the spot market prices and benefiting, some of the outflow of capital markets. At present, PTA prices have hit a new low over the past few years, continued to fall in weakening impetus, but the current level of a sharp rise in the probability is very small, the rebound can be expected. After all, the current spot market price in the futures far above the 901 last week in 5200 near the close, while the spot price in the vicinity of 5650. At the same time, aggregate inventory is not high, started in the maintenance of the general state of 75, is currently in the lower reaches of lay-off and low-opened, once believed to stabilize prices, the lower reaches of centralized purchasing and polymer to add short-term stock market is worth waiting for.

Fifth, the macro-control in textile and garment export tax rebate rates and ease the country’s business capital market impact. First of all, belonging to the chemical processing industries in the middle, and the processing trade is dominated by direct basic income can be ignored; Second, the current prices of raw materials and products are falling under the state, we find that even if the whole industrial chain to reduce the funds still will not affect the The normal operation of industry, in the PTA, MEG, and other main costs account for 80 percent of cases, because of its price down substantially, the same scale of production capacity polymerization of the operation to reduce the demand for funds is very large, it appears that many of the remaining funds, which is why this year There are many factories to provide financing of the main reasons for high finance.

Sixth, we do not rule out the industry to continue large-scale arising from the bankruptcy and related industries, such as security and since they involve broad. In the textile industry as a whole increased operating costs, RMB appreciation, insufficient demand, inventory at a discount, and the deterioration of the operational effectiveness of the industry into the depth of the adjustment process, not a lot of relatively competitive enterprises out of the industry is understandable. Data from the export of raw materials and basic consumption up to judge, shrinking the industry and competition brought about by the deterioration of the relevant Sanxin similar events is normal, this market is, of course, very bad.

Overall judge, and sluggish demand in the lower reaches of the upper reaches of the cost of collapse, having PTA market is still not optimistic.