Crude Oil, Chemical and Fiber Market Week 23 Jun 7, 2020

Crude Oil , PTA and MEG , Polyester chip, Polyester filament yarn, PSF Updated market trend of Week 23:

Data this week – W23


Market this week – W23

Summary: Oil went up, PTA and MEG, Polyester chip rose and stabilized, Polyester filament yarn  increased, PSF rose, VSF stalemate.

1,Oil prices closed up slightly. Increasing tensions between China and the United States have put pressure on the market, but there are reports that OPEC and Russia are close to reaching an agreement to extend the production cut agreement, which constitutes support for oil prices and oil prices remained stable at the beginning of the week. OPEC and Russia are expected to reach a consensus on the extension of the output reduction agreement at the June 4 meeting. Together with EIA and API data, US crude oil inventories have unexpectedly decreased last week, and oil prices have risen slightly.

2,PTA futures oscillated and consolidated, the basis strengthened, and PTA spot rose. With the continuous relaxation of epidemic control in many markets, the recovery of crude oil demand expectations and the OPEC+ plan to extend production cuts and other news, the increase in crude oil has expanded. At the same time, although the planed overhaul of some PTA lines has been delayed, the  downstream polyester load is in high level, the pressure of PTA accumulation has eased. In addition, the enthusiasm for procurement has increased due to the improvement of production and sales of some polyester factories. The current basis has converged. In the second half of the week, there’s rumors of individual PTA plant restarts in the market, crude oil shocks and other factors affected the traders’ willingness to sale, and the basis was stable. The short-term PTA is expected to maintain a volatile trend.

3,MEG prices are sorted in a narrow range, and the market is generally negotiated. Mid-week was significantly boosted by the crude oil market and the follow-up of production and sales was acceptable. MEG prices briefly surged, but the high selling pressure was obvious. Until Friday, MEG prices fell slightly, and the market mentality tended to be cautious during the restart of coal chemical MEG plants. It is expected that the short-term MEG shock adjustment will be the main trend.

4,The polyester chip market has risen again. Due to the surge in crude oil, polyester raw materials have risen again during the week. Especially driven by market sentiment at the beginning of the week, the chip trading atmosphere is good, coupled with the tight supply of mainstream factories, the prices have been continuously raised, and the market turnover has been overall. In general, buying is mainly concentrated in the first half of the week, and the trading volume in the second half of the week has dropped significantly.

5,Jiangsu and Zhejiang polyester filament yarn sales is boosted by the rebounded materials. The overall production ratio of the downstream can still be maintained with stable support. At the same time, raw materials rose, and downstream factories continued to follow up to increase stock of raw materials. The polyester yarn factories transaction volume increased significantly on Monday and Thursday, and prices increased too. The price of polyester yarn in southern China rose partially. In the export market, foreign markets are relatively quiet. On the whole, foreign markets have been slow to recover due to the epidemic situation. At present, the factories are mainly domestic sales, and most of the export quotations follows domestic price and negotiated order by order .

6,Polyester staple fiber moderated after rising, and sales were smooth. Polyester raw materials continue to rise, driven by costs and no inventory pressure, staple fiber factories continue to rise, quotations generally rise, and transaction prices gradually follow up. In the second half of the week, due to the shock of raw materials, the PSF stopped rising and stabilized, the turnover fell back, and the downstream entered the digestion cycle. The fundamentals of PSF are good. If the raw materials continue to rise, the PSF may still rise, otherwise it will still maintain a range fluctuation.

7,Viscose staple fiber continued to stalemate at a high level, but showed a priceless situation. High white fiber continues to weaken. Although there is no excessive price reduction under the support of high-end orders, some can be discussed. There was no sign of continuous improvement in exports, and the resumption of work in the main export target countries was average.

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